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Saturday, March 18, 2006

Those Crazy French Kids

Once again the French youth are showing the world why we don't envy them. In response to a new plan by the President to make jobs available for those who want to work, they rioted, smashing windows, starting fires, the things we've become used to with them.

What's the horror of this plan? The President wants to authorize the firing of new workers in their first 2 years without reason. I'm not sold on the "no reason" part, but being able to let go of unproductive workers in generally a good business tenant.

For those who aren't familiar with French labor law, it's nearly impossible to fire a worker, so business is reluctant to hire anyone, for fear a recession will put them out of business because of labor costs. This makes it hard for youth to break into the job market, because older people are filling most of the jobs.

Add to it the exorbitant taxes the government charges business to pay for forced retirement with generous benefits. What you get with that is 10% unemployment overall, and 25-50% for youth, depending on social class.

The President's proposal would allow businesses some flexibility, which they've been screaming for, and might actually coerce some of Europe's least productive workers into productivity, for fear of being fired.

The students protesting today called this "anti-capitalism", actually kids, it's capitalism at it's finest. What it really should be called is "anti-socialism". Some further loosening of the socialist knot around the neck of your economy might get more of you some jobs.

While the French youth are afraid of this loosening of labor law, if they would look to Denmark, they'd see that it worked quite well there. Since the mid-90's when they reduced government labor regulation and taxes they've had the fastest growing economy in western Europe. Along with Britain they have the lowest unemployment rates, and good economic growth, along with the lowest business taxes, and least restrictive labor rules.

Unfortunately, the government in France is convinced it can engineer business to get what they want out of it, and have been failing miserably. A few years back they legislated the 35 hour work week, (with 40 hours of pay), figuring business would hire more people to fill the hours. Instead, they made do with what they had, or left for the former Soviet Bloc countries, where costs are lower.

When people wonder why conservatives here want the government out of business as much as possible, I just point to France, Germany, Italy and Spain. Four formerly great economic powers that really are second rate in many ways, mostly because of their government's involvement in business.

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5Comments:

Blogger Poser said...

Well, I'll be jiggered. I actually agree with you, CP. The French have a wealth of human and natural resources, but their economy is lagging because of over-regulation. I remember that 35-hour work week idea. How dumb.

9:03 PM  
Blogger shoprat said...

The French are just bound and determined to destroy France. I wonder if anything anywhere could wake them up.

I remember a year or so ago I saw an ad for a resort in Florida where it was compared to Paris for its elegance, food, shops etc but then they added a great line "It is just like Paris, only better ... because it's without the French."

9:55 PM  
Blogger Crazy Politico said...

Poser, I'll try not to write anything you agree with again if it will make you feel better :)

The sad thing is they used to have some vibrant manufacturing and pharmaceutical industries that they've destroyed by regulation.

Shoprat-I think France is showing the logical conclussion of the "gimme state". They've put themselves in a position they can't get out of.

4:00 AM  
Blogger Lone Pony said...

Excellent post Bob. I didn't realize France was this bad until I read Atlas Shrugged and I was discussing it with the person who recommended it. He spoke about the mess Canada and France had made. What a shame.

5:25 AM  
Blogger Crazy Politico said...

Canada's mess has gotten slightly better, but not a lot. They've loosened up their regulations enough that the unemployment rate has gotten under control. In other words business is staying there.

France, and Germany though are still so tightly controlled that they can't keep business. Just watched a German newscast. Two more of their big manufacturers are moving to the old Eastern European area. There won't be a wage change, but enough tax change that they can hire more people, and lower their prices!

5:43 AM  

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