Thu, Aug 29, 2013 - Page 9 News List

French leftists are forced to fight against the system they installed

Students, unions and workers in France prefer that their lives not change too much, but the aging population and the economy will soon make change a necessity

By Steven Erlanger  /  NY Times News Service, PARIS

“The young people march now to reject all reforms,” he said. “We see no alternatives. We’re a generation without bearings.”

The Socialists have become a conservative party; desperately trying to preserve the victories of last century. Many in the party, like French Minister of Industrial Renewal Arnaud Montebourg, who is also an antiglobalization campaigner — let alone those further to the left — seem to believe that France would be fine if only the rest of the world would disappear, or at least work a little less.

There is an understanding that there will be little lasting gain without structural changes to the state-heavy French economy. The warning signs are everywhere: French unemployment and unemployment among young people are at record levels; growth is slow compared with Germany, Britain, the US and Asia; government spending represents nearly 57 percent of GDP, the highest in the eurozone, and is 11 percentage points higher than Germany’s.

Furthermore: The French government employs 90 civil servants per 1,000 residents, compared with 50 in Germany; hourly wage costs are high and social spending represents 32 percent of GDP, the highest among industrialized countries; real wage increases outpace productivity growth; and national debt is more than 90 percent of GDP.

About 82 percent of the new jobs created last year were temporary contracts, up from 70 percent only five years ago, not the kind of full time work that opens the door to the middle class. That keeps nearly an entire generation living precariously, no matter how diligently people study or work.

Last year, France was ranked 28th out of the 60 most competitive economies in the world, according to the International Institute for Management Development in Lausanne, Switzerland. The US was first. Even China and Japan, which came in 21st and 24th respectively, outranked France. In the World Bank’s ranking of “ease of doing business,” France ranks 34th, compared with 7th for Britain and 20th for Germany.

In Amiens, in the north of France, Goodyear owns two tire factories. The workforce at one has grudgingly accepted a change in work schedules which has preserved the factory. The workers at the other have refused, and Goodyear is trying (not so easy in France) to shut it down, throwing more people out of work. Claude Dimoff, a former union leader at the more flexible plant, said: “I’m part of a generation that experienced the common program of the left. We had visions for the future, and different values, but all this is forgotten. The left has completely deviated from its promises.”

The country retains plenty of strengths. France is the world’s fifth-largest economy, with strong traditions in management, science and innovation. The gap between rich and poor is narrower in France than in most Western countries, although it is growing.

When the French work, they work hard; labor productivity, perhaps the single most important indicator of an economy’s potential, is still relatively high, although it is dropping. With long holidays and the 35-hour workweek, the French work fewer hours than most competitors, putting an extra strain on corporations and the economy.

Large French companies compete globally; there are more French companies in the Fortune 500 than from any other European country, but the bulk of their employees are abroad, and there are few of the midsize companies that are the backbone of Germany. Ninety percent of French companies have 10 or fewer employees and fear expansion because of extra tax burdens and strict labor regulations.

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