If You Want 10%+ Unemployment... Follow the French Lead

PittsburghAfterDark

CAGiversary!
PARIS, Feb 5 (Reuters) - French President Jacques Chirac's conservative government faced a major challenge to its economic policies on Saturday as tens of thousands of public and private sector workers protested over labour laws, pensions and schools.

With more than 50,000 taking to the streets in provincial cities, organisers said they hoped for a national turnout of at least 300,000 nationwide to ram home their message.

"The government would do well not only to hear but to listen to the workers," said the secretary-general of the CGT union, Bernard Thibault, at the start of the rally in Paris.

The protests come as parliament debates a government plan to allow staff in the private sector to increase overtime and work up to 48 hours a week, the maximum allowed under EU law. But managers must first agree the changes with unions.

Prime Minister Jean-Pierre Raffarin says rules must be relaxed to help cut stubbornly high unemployment, currently close to 10 percent, and make the world's fifth largest economy more competitive.

Four of France's five major unions called Saturday's protests against reforms they say would sound the death knell of the 35-hour week and result in longer hours without extra pay.

"Chirac, Raffarin, are you sleeping? Your workers are in the street," chanted demonstrators in Toulouse in southwest France.

The 35-hour week was introduced in 1998 by the previous Socialist administration in an effort to reduce joblessness. The party has called on Raffarin to abandon his reform and re-open negotiations with the unions.

"This reform will have very unfortunate consequences on the labour market as, at a time when we have three million unemployed, overtime will be increased which will deprive even more people of jobs," said Socialist party leader Francois Hollande at a demonstration in the western city of Rennes.

GOVERNMENT WARY

Buoyed by the success of Jan. 20 rallies that drew support from 210,000 state workers -- the public sector employs about a quarter of the French workforce -- unions say their campaign is gaining momentum.

Raffarin is wary of large public protests after voters punished his government for unpopular economic cutbacks in regional and European Parliament elections last year.

He has played down any parallels with street protests that are widely seen as causing the downfall of the last conservative government in 1997.

Although no elections are due before 2007, the cash-strapped government is concerned French voters could express their anger over reforms when they vote in a referendum on the European Union constitution before the summer.

Both Raffarin and Chirac have urged voters to approve the treaty on its merits and not allow themselves to be sidetracked by domestic political issues.

A recent poll showed some 77 percent of workers surveyed wanted to keep their working week at the current level. Only 18 percent wanted to work longer hours.

CNN Link

Notice anything here? The shorter work week would entice businesses to hire more people... uh huh. Right. Want to know how many French companies moved more and more of their labor overseas as a result of this? Just like here, France and its socialists/liberals prove once again that the results of their good intentions are 180 degrees from their stated objectives.

You mean these feel good 35 hour work weeks, 6 weeks of vacation, high taxes, employment regulation out the wazoo result in 10%+ unemployment?

Who knew!

Want to know why the EU is doomed to failure? 48 hour maximum workweek. If you're going to cap overtime against the world standard (No overtime.) your economy is never going to be the envy of the world. Just another reason why the EU cannot compete long term in the global market.
 
I'm not really arguing for one side or the other, just that you're failing to look at other examples. http://www.bbc.co.uk/radio1/onelife/travel/atoz/sweden_work.shtml
Both taxes and the cost of living are high.

Ceramics, furniture, glass and silver are leading exports.

There are many industries linked to the country's timber resources.

Sweden has a 35-hour working week — one of the shortest in Europe.
STOCKHOLM, Sweden (AP) -- Unemployment in Sweden rose to 5.3 percent in December after dipping below the 5 percent mark in November, the country's statistics agency said Wednesday.
Unemployment increased by 0.2 percent compared to the same time last year, a figure within the margin of error, Statistics Sweden said. Neither the number of employed or unemployed showed any statistically significant difference compared with December 2003, the agency said.

In November, unemployment was at 4.9 percent.

The Swedish Embassy website includes a job matching service, online application forms and special information for au pair work.


The 5.2 percent that the u.s. just hit is it's lowest in three years. To add some strength to your argument, you may want to explain why sweden has many of the same things as france, but does not suffer the same problems.





http://biz.yahoo.com/ap/050126/sweden_unemployment_1.html
 
The real problem here isn't forcing companies to treat their workers well: the real problem is that such policies aren't universal. You're quite right that companies aren't going to want to pay their workers well and let them work short hours with vacation when they can simply move to China. Your proposed solution, though, essentially boils down to 'we have to ensure that our working condistions are the shittiest in the world in order to compete'. The Chinese are working 14 hour days for 25 cents an hour? We'll force our people to work 16 hours a day for 24 cents an hour! And you can beat them to death if they're not working hard enough!

Corporations are the purest, most distilled form of evil that human beings have managed to come up with. They can be useful tools when managed properly, but left unchecked, they do nothing but leave destruction in their wake in the never-ending quest of maximizing profit.

The question, then, is how to manage them properly. Its a complicated topic, but a good starting guide would probably be Adam Smith's Wealth of Nations (probably the single most minunderstood/misrepresented books ever written. Its constantly used to justify the evils that the book was written to help prevent.)

Anyway, specifically regarding this situation, the French government has tried to control corporations a bit too much - they're simply not big enough to do it. The real problem right now is the abundance of cheap labor in third-world markets. That sort of disparity can't be maintained, and there's ultimately only 2 possibilities: either fall to their level, or raise them up to our level of propsperity (or some combination of the two.) Obviously, the latter option is the preferable one (at least to the non-insane...) My own recommendation has been and is that minimum wage rules need to apply to all imports into the US and other civilized/advanced nations. If Walmart wants to import it into the US, they're going to have to pay the workers who make it US minimum wage (and if they want to import it into France, they'll have to pay French minimum wage.) The wages paid for good within China made for their own consumption are their own business, but they'll invariably rise as a result, creating a wealthy middle class there (which invariably leads to lesure time, which leads to education, which leads to a desire for freedom and democracy. Yep, a path to promoting Democracy that's both historically proven and doesn't involve killing people.)
 
[quote name='Drocket'] My own recommendation has been and is that minimum wage rules need to apply to all imports into the US and other civilized/advanced nations. If Walmart wants to import it into the US, they're going to have to pay the workers who make it US minimum wage (and if they want to import it into France, they'll have to pay French minimum wage.) The wages paid for good within China made for their own consumption are their own business, but they'll invariably rise as a result, creating a wealthy middle class there (which invariably leads to lesure time, which leads to education, which leads to a desire for freedom and democracy. Yep, a path to promoting Democracy that's both historically proven and doesn't involve killing people.)[/quote]

That's pretty good, I've never heard that before. Though the cry for democracy has waned in china since tiananmen square, even though wealth has greatly increased, the middle class has grown, and education has increased. Though again, I like your first point, now I gotta try to find some downside to it, it can't be as good as it sounds. All I can think of is that it would raise the price of goods in stores, meaning poor people in wealthy nations can afford to buy less and their living standard may drop, but the increase in the living standard of other nations would easily outweigh that.
 
[quote name='alonzomourning23']That's pretty good, I've never heard that before. Though the cry for democracy has waned in china since tiananmen square, even though wealth has greatly increased, the middle class has grown, and education has increased.[/quote]
China doesn't really have a middle class right now. At best, they have a layer of 'gravel poor' people (right above the 'dirt poor' majority, you see :) ), but that's about it. A lot of the decrease in the cry for Chinese democracy is because they've actually been granted quite a few liberties in the past decade or so. They're a long way from free, but they're at least not as oppressed as they were. In the short term, that's increased the overall level of satisfaction with the Chinese government, but I suspect that in the long term, its going to give them a taste for what freedom can be like (that also makes them more dangerous to us, though, as their government weakens... One problem at a time, though :twisted: .) Of course, China has never been even a remotely free nation at any point in its history, so their idea of freedom tends to vary quite a bit from ours.

Though again, I like your first point, now I gotta try to find some downside to it, it can't be as good as it sounds. All I can think of is that it would raise the price of goods in stores, meaning poor people in wealthy nations can afford to buy less and their living standard may drop, but the increase in the living standard of other nations would easily outweigh that.
That is a short-term effect, but in the long-term, it actually improves the standard of living for most Americans (/other western nations) because as the Chinese(/other third-world/Asian) standard of living improves, they'll be able to afford to purchase our goods in return (the trade deficit closes), which creates more high-paying US manufacturing jobs.
 
[quote name='"Drocket"'][quote name='alonzomourning23']That's pretty good, I've never heard that before. Though the cry for democracy has waned in china since tiananmen square, even though wealth has greatly increased, the middle class has grown, and education has increased.[/quote]
China doesn't really have a middle class right now. At best, they have a layer of 'gravel poor' people (right above the 'dirt poor' majority, you see :) ), but that's about it. A lot of the decrease in the cry for Chinese democracy is because they've actually been granted quite a few liberties in the past decade or so. They're a long way from free, but they're at least not as oppressed as they were. In the short term, that's increased the overall level of satisfaction with the Chinese government, but I suspect that in the long term, its going to give them a taste for what freedom can be like (that also makes them more dangerous to us, though, as their government weakens... One problem at a time, though :twisted: .) Of course, China has never been even a remotely free nation at any point in its history, so their idea of freedom tends to vary quite a bit from ours. [/qupte]

It's true there is an increase in freedoms, it clearly is not the saddam like state many make it out to be. It suprises me the amount of protests (though small and not nearly as open in their denouncements as in the west) against government policies they have, and the amount of public denouncements their citizens make of corrupt local governments. I remember particularly an old chinese man, living in rural china, denouncing the local government for being thieves, cruel etc. because they were closing an orphanage (shown on the cbc). That's not to say it's not repressive, and brutal selectively, just not to the level of some countries. Then again, a gradual shift to more freedom is clearly preferable to the collapse that the soviet union had. Though they definately have a middle class, primarily in cities such as shanghai, beijing etc.

Though I don't think things would work out that well (referring to your idea that everything would balance and the lower class in the u.s. would only suffer short term), but I haven't done enough thinking or research on it to have any real opinion one way or the other.
 
[quote name='Drocket']My own recommendation has been and is that minimum wage rules need to apply to all imports into the US and other civilized/advanced nations. If Walmart wants to import it into the US, they're going to have to pay the workers who make it US minimum wage (and if they want to import it into France, they'll have to pay French minimum wage.) The wages paid for good within China made for their own consumption are their own business, but they'll invariably rise as a result, creating a wealthy middle class there (which invariably leads to lesure time, which leads to education, which leads to a desire for freedom and democracy. Yep, a path to promoting Democracy that's both historically proven and doesn't involve killing people.)[/quote]

That is an interesting idea, one I've not heard before, but I don't think it would work for a couple of reasons.

First of all, under those rules no country would ever go from a Third World undeveloped country to a developed country. If you think people are going to hire uneducated Chinese and pay to ship the things they make to the U.S. instead of paying the same for American workers, better educated and not have to pay to ship, you're crazy. China's export-driven economy would collapse because their biggest competitive advantage is cheap labor and biggest disadvantage is lack of an educated workforce. The same can be said of most developing countries. You're just preventing them from growing economically by shutting them out of the richer countries' markets, making them even poorer than they already are.

Secondly, even if you did put a system in place like that, there's no way to enforce it. And if you did put it in place and somehow enforce it, every country it affects will surely immediately erect trade barriers to American goods, hurting ourselves as well. As a matter of fact, forcing countries to adopt our wage/benefits standards would hurt our country because consumers here (you and me) will pay more for a lot of things.
 
[quote name='elprincipe']First of all, under those rules no country would ever go from a Third World undeveloped country to a developed country.[/quote]
I'm not really sure if countries go from third-world nations to developed countries by manufacturing McDonald Happy Meal Toys for 50 cents/day anyway...

Even so, its definitely a plan that would need to be implemented over time. Simply applying a major shift in policy like that one day would definitely cause rather horrible chaos. You'd probably want to start at maybe 50% of US minimum wage, then raise it by 5%/year over 10 years.

Even at 100%, though, there's still a lot of reasons that companies might prefer overseas workers - US workers are usually quite a bit more demanding and are rarely happy with minimum wage. Companies can shaft US workers right now because overseas labor is so much cheaper (starvation-level cheap), but as US unemployment drops, the actual wages that companies have to pay to keep employees naturally rises independant of minimum wage. So even requiring minumum wage for overseas workers, they would STILL be quite a bit cheaper than US workers, at least at times of full-employment in the US (and if/when the US is suffering from unemployment problems, I'd prefer to keep the jobs here.)

Secondly, even if you did put a system in place like that, there's no way to enforce it. And if you did put it in place and somehow enforce it, every country it affects will surely immediately erect trade barriers to American goods, hurting ourselves as well.
What are they going to do, require that we pay our workers their minimum wage? :p

Anyway, the Chinese government isn't going to like it, because its going to undermine their power, but the Chinese people ARE going to like it because they're going to stand to make a whole lot more money. "The evil Americans are forcing us to pay you more money!" really isn't going to go over too well as a call to action. If the Chinese government pushes back too hard, they could be risking insurrection from within.

As a matter of fact, forcing countries to adopt our wage/benefits standards would hurt our country because consumers here (you and me) will pay more for a lot of things.
There's a few levels of argument here: one is the moral argument - cheaper isn't always right. Chaining 14 year olds to work benches and forcing them to work 12 hour days for barely enough money to avoid starvation just so we can get cheap shoes isn't something we should be doing just because we can.

The second argument is more pragmatic: We're a consumer nation, now, not a producer. We don't really make much of anything anymore, just sell it back and forth for more money. We've pretty much become completely dependant on foreign nations for far too much stuff. This is a dangerous position to be in.

The third level is economic: We're getting goods for cheaper, but overall, most people are making less, too. That is, again, because virtually no one in the US is actually making anything, just selling it back and forth, an action which doesn't produce value. We need to return to a stronger manufacturing base not only for our oun security, but also because doing so has economic advantages.
 
[quote name='Drocket']What are they going to do, require that we pay our workers their minimum wage? :p[/quote]

Ever heard of tariffs?

[quote name='Drocket']There's a few levels of argument here: one is the moral argument - cheaper isn't always right. Chaining 14 year olds to work benches and forcing them to work 12 hour days for barely enough money to avoid starvation just so we can get cheap shoes isn't something we should be doing just because we can.[/quote]

I'm not doing anything of the sort. Personally I abhor companies that use child labor or even forced labor and don't buy their products, for example Nike. Obviously I'm not suggesting it's great that children are forced to work for 10 cents a day in Indonesia sewing up Air Jordans that sell for $125 here. I could now easily get drawn into a tangental argument about the moral sewer that is Michael Jordan because of this, but I'll leave it at that.

[quote name='Drocket']The second argument is more pragmatic: We're a consumer nation, now, not a producer. We don't really make much of anything anymore, just sell it back and forth for more money. We've pretty much become completely dependant on foreign nations for far too much stuff. This is a dangerous position to be in.[/quote]

You should really know what you're talking about, or at least check some numbers before you post.

http://www.comw.org/poc/0410.html

Our only real dependence is on foreign energy sources.

[quote name='Drocket']The third level is economic: We're getting goods for cheaper, but overall, most people are making less, too. That is, again, because virtually no one in the US is actually making anything, just selling it back and forth, an action which doesn't produce value. We need to return to a stronger manufacturing base not only for our oun security, but also because doing so has economic advantages.[/quote]

Again,

http://www.comw.org/poc/0410.html

People's incomes have increased and people's disposable incomes have increased. I suppose you're still living in the world where every bit of Democratic doom-and-gloom propaganda is true, but here in the real world, fortunately, things aren't so glum.
 
[quote name='elprincipe']Our only real dependence is on foreign energy sources.[/quote]
Find a computer made entirely in the US, or a car. Hell, find a toaster made entirely in the US. Good luck with that.

People's incomes have increased and people's disposable incomes have increased. I suppose you're still living in the world where every bit of Democratic doom-and-gloom propaganda is true, but here in the real world, fortunately, things aren't so glum.
If you juggle the numbers enough, and only look at short periods of history, yep, you can prove things like that. For one, your chart only goes back to to 1993, not exactly a huge time period. In fact, the report says right above the section that you're referring to that the gains made during that time period are highly unlikely to be repeated because most of them are due to the dot-com bubble.. Secondly, the numbers provided are an average, and because of the huge gap between rich and poor (which currently is EXTREMELY high and growing all the time), shifting the numbers far higher than those experienced by 90% of the population.
 
[quote name='Drocket'][quote name='elprincipe']Our only real dependence is on foreign energy sources.[/quote]
Find a computer made entirely in the US, or a car. Hell, find a toaster made entirely in the US. Good luck with that.[/quote]

People's incomes have increased and people's disposable incomes have increased. I suppose you're still living in the world where every bit of Democratic doom-and-gloom propaganda is true, but here in the real world, fortunately, things aren't so glum.
If you juggle the numbers enough, and only look at short periods of history, yep, you can prove things like that. For one, your chart only goes back to to 1993, not exactly a huge time period. In fact, the report says right above the section that you're referring to that the gains made during that time period are highly unlikely to be repeated because most of them are due to the dot-com bubble.. Secondly, the numbers provided are an average, and because of the huge gap between rich and poor (which currently is EXTREMELY high and growing all the time), shifting the numbers far higher than those experienced by 90% of the population.

You also have to look at inflation. Even if you have more money that doesn't mean you can buy more. I'm not saying it hasn't increased even this way, I don't really know.

Looking at that website, it seems the yearly increase in income and disposable has decreased significantly since bush took office.
 
[quote name='alonzomourning23']You also have to look at inflation. Even if you have more money that doesn't mean you can buy more. I'm not saying it hasn't increased even this way, I don't really know.

Looking at that website, it seems the yearly increase in income and disposable has decreased significantly since bush took office.[/quote]

You're reading it wrong, it's percent change, not percent total. It's been positive since Bush came into office, as it has been over the entire time period covered:

2001 +3.8%
2002 +5.2%
2003 +4.6%
2004 +4.6%
 
[quote name='elprincipe'][quote name='alonzomourning23']You also have to look at inflation. Even if you have more money that doesn't mean you can buy more. I'm not saying it hasn't increased even this way, I don't really know.

Looking at that website, it seems the yearly increase in income and disposable has decreased significantly since bush took office.[/quote]

You're reading it wrong, it's percent change, not percent total. It's been positive since Bush came into office, as it has been over the entire time period covered:

2001 +3.8%
2002 +5.2%
2003 +4.6%
2004 +4.6%[/quote]

1993 3.1 3.3
1994 5.1 4.9
1995 5.3 5.0
1996 6.0 5.2
1997 6.1 5.3
1998 7.3 6.8
1999 5.1 4.7
2000 8.0 7.5
2001 3.4 3.8
2002 2.3 5.2
2003 3.3 4.6
2004 3.6 4.6

I don't see how I read that wrong, I said the yearly increase isn't as great since bush came into office.
 
[quote name='alonzomourning23'][quote name='elprincipe'][quote name='alonzomourning23']You also have to look at inflation. Even if you have more money that doesn't mean you can buy more. I'm not saying it hasn't increased even this way, I don't really know.

Looking at that website, it seems the yearly increase in income and disposable has decreased significantly since bush took office.[/quote]

You're reading it wrong, it's percent change, not percent total. It's been positive since Bush came into office, as it has been over the entire time period covered:

2001 +3.8%
2002 +5.2%
2003 +4.6%
2004 +4.6%[/quote]

1993 3.1 3.3
1994 5.1 4.9
1995 5.3 5.0
1996 6.0 5.2
1997 6.1 5.3
1998 7.3 6.8
1999 5.1 4.7
2000 8.0 7.5
2001 3.4 3.8
2002 2.3 5.2
2003 3.3 4.6
2004 3.6 4.6

I don't see how I read that wrong, I said the yearly increase isn't as great since bush came into office.[/quote]

Well, from your post above it seems as if you didn't realize that disposable income was increasing, instead focusing on inflation, which is very low at this point in time. And the yearly increase under Bush seems to be about the same as in other years when you average it out, of course going back only 11 years. I only took those numbers because the more complete ones I found only went up to 2001.
 
[quote name='alonzomourning23']I'm not really arguing for one side or the other, just that you're failing to look at other examples. http://www.bbc.co.uk/radio1/onelife/travel/atoz/sweden_work.shtml
Both taxes and the cost of living are high.

Ceramics, furniture, glass and silver are leading exports.

There are many industries linked to the country's timber resources.

Sweden has a 35-hour working week — one of the shortest in Europe.
STOCKHOLM, Sweden (AP) -- Unemployment in Sweden rose to 5.3 percent in December after dipping below the 5 percent mark in November, the country's statistics agency said Wednesday.
Unemployment increased by 0.2 percent compared to the same time last year, a figure within the margin of error, Statistics Sweden said. Neither the number of employed or unemployed showed any statistically significant difference compared with December 2003, the agency said.

In November, unemployment was at 4.9 percent.

The Swedish Embassy website includes a job matching service, online application forms and special information for au pair work.


The 5.2 percent that the u.s. just hit is it's lowest in three years. To add some strength to your argument, you may want to explain why sweden has many of the same things as france, but does not suffer the same problems.





http://biz.yahoo.com/ap/050126/sweden_unemployment_1.html[/quote]

It's also important to find out how these numbers are calculated. For example, in the US the unemployment number reflects the number of people collecting unemployment, not the actual number trying to find a job. Currently, the "real" US unemployment figure is closer to 8%. It is my understanding that France reports true unemployment figures, so they are not so far off after all from the US.
 
bread's done
Back
Top