In the face of protests, Chirac has abandoned his government’s employment law reforms, making France a test bed for the notion that “social justice” trumps economic growth.
President Jacques Chirac has surrendered to the power of street protest by abandoning a new youth job law after weeks of rioting and protests …
The measure – intended to make it easier for employers to hire and fire workers aged under 26 – was fiercely resisted by students, school pupils and trade unions, and opposed by two thirds of the population, polls showed.
It was characterised by France’s critics as a “revolution for the status quo”, with young people seeking to maintain the level of job security enjoyed by their parents and grandparents.
All the French residents I know are happy with their economic lot. The unemployed get enough to live on and a zero hour work week, the employed have jobs for life and a 35 hour work week, and the state provides a good infrastructure and health care in return for high taxes.
Country dwellers can grow their own food and live simple but pleasant lives on tiny incomes, and income inequality is less than in competitive societies:
…France’s poverty rate remains one of the lowest in the world, at 6% (compared to 18% in the UK and 15% in the US).
By US, Southern UK, and Asian Tiger standards, most French are poor. But those wanting a better life can relocate to the UK leaving the majority that chooses not to compete in the global rate-race.
This model may be sustainable, provided unemployment doesn’t rise significantly – if it does, tax revenues will fall (as less are employed), and welfare costs rise – that means higher taxes and lower state benefits. Then the riots will begin again.
I hope their experiment continues to succeed.