29 June 2013

Nice, France – I’m just down to sea level from the 2,600 meter high mountain forts on France’s wild, vertiginous Alpine border with Italy.

The Cote d’Azur, or Riviera, is buzzing with summer activity: packed beaches, traffic jams, crowded restaurants, outrageously priced hotels and an armada of yachts jostling for scarce marina space.

Looking at all this opulence and conspicuous consumption one would not know that France is plunged these days into economic and mental depression. French call it “morosité.”

French are an excitable people. They often strike me as an unstable mix of Germans and Italians. When French spirits are high, they are unstoppable. Just think of Napoleon’s armies and the “furia francese.” But French morale can sink just as fast. Today, France’s spirits are down in the dumps.

Other nations would be lucky to have such problems. In spite of uncontrollable debt, high unemployment, strikes, and declining industry, bountiful France is still one of the world’s most beautiful nations and best places to live.

French have one of the world’s best, most responsive health care services. Its food, wine and culture astound and delight. TGV high-speed trains zip through the beautiful countryside. Unlike much of western Europe, France is a large nation with varied topography, and distinctive regions. Some 75% of French spend their lavish, six-week vacations in their own country.

French still read books, study history, and, for the most part, eat real food. Never mind all those silly academic studies that tell you Auckland, New Zealand is the best place to live, France is the world’s premier destination and place to live.

Now, the bad news. Glorious, beautiful, well-run France may be facing the end of its “bel époque.” French industry has been ruined by overly powerful unions and their political allies in the Socialist Party.

One would be crazy these days to open a factory in France with its absurd 35-hour work week, endless vacations, surly unions, strikes, and social costs that add 50% to worker’s salaries. Laying off workers during downturns or closing plants involves siege warfare, with posturing socialist politicians fighting employers at every turn.

In an ominous new development, French have taken to comparing their economic malaise to Germany’s vibrant economy where past tough structural reforms in the labor market modernized and made its industry competitive.

Thanks to German’s intelligent system of vocational training for youth, its youngsters are at work while 45% of young French are unemployed. No wonder. French universities keep churning out unemployable graduates in social anthropology, sociology, and film-making.

Government in France employs 56% of all workers, an unsustainable cost that, with retirement at 60 and unemployment benefits – now 32% of GDP – is bleeding the economy to death. Even President Francois Holland’s recent tax increases will not save the economy from ruin – and France from a possible euro crisis.

The problem is that many French know their gravy train must slow down but they can’t bear to change. “La vie en rose” is just too seductive. Special interests – farmers, teachers, truckers, transport unions – demand the “rich” pay the bill. They can shut down France.

But there are not enough ”rich” to foot France’s big bills – or America’s, for that matter. Many wealthy French are moving out of the country, like Gerard Depardieu, or quietly moving assets to more friendly locales. French fear that the desperate socialists will slap more and higher taxes on citizens and even on foreign residents. Louis XVI had similar cash problems.

France’s media is full of alarms all about how the industrious Germans are pulling way ahead, as if Germans were somehow a threat to France. This is potentially a very dangerous notion. The Franco-German entente is the rock upon which united Europe is built. Nothing must be allowed to endanger this architecture – particularly not envy, nationalism, and blaming the Teutons for France’s self-inflicted wounds.

What France urgently needs is another Charles De Gaulle who had the courage and strength to end the bitter war in Algeria in 1962 and bring stable government. A new De Gaulle must force drastic cuts in social welfare and spending, and force French to learn a new work ethic.

copyright Eric S. Margolis 2013

This post is in: Europe, France


  1. George Rizk says:

    France became a colony of the American empire. They denied Bolivia’s presidential jet flying over its air space on an order from emperor Obama!

  2. It seems to me, that any benefit to the masses takes away the pleasures of the 1%, who like to think of the ‘rabble’ as their servants. Look at the conditions France had, when they were yoked with the excesses of the elites under Louis XVI. Today the same conditions prevail and not just in France, but worldwide. A localized revolution like the one, that liberated the French then, is now needed on a world-wide scale. It is as if the old elite families managed to regain their previous wealth and glory and make history repeat itself, except that that malaise is not unique or uniquely French anymore. They are even worse in the US, which we are led to believe is the bastion of democracy. Our new communication systems have made it a world-wide phenomenon. We are in a new epoch of slavery, unlike the world has ever known and to me peace can only be realized, with a decentralized socio-economic democracy, guaranteed in an irrevocable and inalienable UN constitution, which itself needs rewriting at present, because of the built-in inequality clauses, the worst of which are the veto-rights of some countries, that give them dictatorial powers over others, the abuse of which we can see in today`s society.
    And for some form of capitalism to survive and be equitable to all people, the entire banking system has to be overhauled and most certainly the right to print money, which in a true democracy can only be in public hands. The French revolution was kidstuff compared to the Bolshevik revolution, which again will be dwarfed by the one needed to rid the world of the excesses and inequalities the masses suffer today. And with the weaponry at our disposal today, that may spell the end of our species.

  3. Mike Smith says:

    Another thought…
    What were the US doing with the NSA data ?
    They were talking tough against anyone who would attempt to monitor American computers… but now as it is revealed they were into everyone elses information… what were they doing with it ?
    It could be used for intelligence purposes, or trade talks, or perhaps sold to the highest bidder among American and American friendly capitalists.

  4. George Rizk says:

    Was in France last summer, and was impressed with the quality of life, the infrastructure, as well as the modern technologies almost on par with the US.

    The general attitude of American superiority was indeed correct during the fifties, and sixties, even the seventies. Since then, our decline in infrastructure began with our waste on war, and thousand overseas bases, as Europe’s gradual improvement.

    France as most of Europe has suffered from the global economic set back of recent years, from which a few counties were spared: china because of its huge export engine, America because own the printing machine of dollar bills, and Germany because they have superior working ethics, and less mismanagement.

  5. I hope it lasts another two weeks. We are going there next week, as well as Italy and Spain. I think we should have gone to Germany. Oh well of all is lost, at least all will be lost while in Paris.

  6. Mike Smith says:

    Also this story, I think will catch the interest of some here
    Why China might be a better superpower
    Unlike the US, China does not have a substantial history of invading and subjugating the inhabitants of far-flung lands.
    While the author fails to mention Tibet, I feel much of his viewpoint is justified. Also… with the theme of this weeks article it bears mentioning that the Western powers economic strength was built on the back of colonialism ( even the United States, though they chose to call it something else )
    China on the other hand is building from a very different base.

  7. Mike Smith says:

    Not only France is facing these troubles, and people finger pointing…
    ” In the wake of the euro crisis, Southern Europeans have increasingly traded their traditions of leisure for more work and more consumption — often at Germany’s prodding. As backlash sets in, this logic must be questioned. ”
    The only point I can offer is centralism. Let the Wealthy have their way, you wind up with wealth distribution like North America, decades of crooked leadership, a corrupt and failing system seeking a revolution.
    Let the Unions have their way you wind up with wealth distribution like the former Soviet Union, decades of crooked leadership, a corrupt and failing system seeking a revolution.
    Balance between the viewpoints, I feel is the only stability. Unfortunately I think we will see a continued battle between the far left and far right until the collapse of the entire system ( worldwide ) is ensured.

  8. There is a lot of truth to France’s economic crisis today….the French have had it too good for too long and it was bound to catch up with them as far as keeping afloat financially.Their boat is about to sink.Like in America,there comes a point when the cookie jar is totally empty and not bottomless.

    As for Germany,I will go as far and say that it is NOT much better off financially than France.With a debt of some 7 trillion dollars,Germany is not going to be able to offer the young people today a decent pension (or any pension at all) for that matter.There are lots of cities in present day Germany with a youth unemployment rate of 50%!The biggest economic mistake Germany made was to create the Euro Zone,which is now a monster that is draining Germany from a financial point.When the Euro was created to be used as the common currency,most Germans saw a drastic cut in their incomes and pensions…although in all fairness food prices have dropped over the last 8 years or so.Vacationers come over to Canada and are astounded by the high cost of living over here as opposed to what it was 30 years ago.In Germany virtually every one owns a “handy”….which is their term for a cell phone and the price of operating their cell phones are a fraction of what they are in North America!And these devises are made here….so one would think that that they would be more expensive to own in Europe…not so.

    Anyways back to the main topic,the largest union IG Metall in Germany has just signed a collective agreement with companies to give their union members a 3% (I believe) raise!It will come to the point that this will give German companies an excuse to outsource more of their labour to neighbouring countries where it is cheaper to manufacture their products.Make no mistake…German quality has suffered immensely because of this,and there is no end in sight.So Europe has only seen a tip of the iceberg when it comes to economic downturn.The workers who are now nearing retirement will still be able to afford a decent retirement,but in 20 years,I predict that the retirees then will live a life of misery.The blame goes entirely to politicians who,in the past 40 years have bought votes with astronomical promises of affording the citizens a life of luxury….much like France has done in the past as well.

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