07 May 2007

Saving France

The recent French election suggests that the French themselves suspect that something has gone wrong in France. Sarkozy's "tough love" approach to saving France was not expected to win out--given the lack of "fighting spirit" that the French have displayed for so long. But can even tough-minded Sarkozy save France, with all her problems?
Agriculture, industrialized and now EU-sponsored, still plays a sizable role in the French economy, but farmers have virtually vanished as a class (constituting only 3 percent of the working population), and whole sections of the countryside have reverted to fallow land and untended forests. The industrial working class is shrinking as well: from 38.5 percent of all jobs in 1974 to about 20 percent in 2005. Workers are deserting both the unions and the left-wing political parties. Thanks to the depredations of urban-renewal projects, historic Paris has been emptied of its traditional working- and middle-class population and turned into a yuppie theme park: much of its unique vibrancy is gone, and other French cities have so far not been able to replace it or to compete with the so-called Eurocities of London, Brussels, Amsterdam, Munich, Berlin, Zurich, Milan, Barcelona.

The French middle class, Chauvel sums up, is haunted by “a sense of impending doom.” Salaries have not kept pace since the 1980’s; meritocracy no longer seems to work as a vehicle of social promotion; unemployment is climbing, devastating the lives of people already deprived of a functioning family; property has become unaffordable unless one inherits; prospects of a secure retirement grow dimmer every year. The parents of today’s middle class, Chauvel writes, “dramatically improved their own standards of living,” but the children “know they will not enjoy a similar fate. In fact they fear they will be downgraded to an impoverished condition.”

Finally, as if all this were not bad enough, there is crime. Until the 1960’s, France was largely a safe country: people like my parents would slip their keys under the doormat or just leave the door unlocked. It is now an extremely unsafe country, rife with violent assault, arson, armed robbery, and murder, often savage. According to the Institute of National Statistics, the overall crime rate—the ratio of reported criminal activity to population—grew from 12 percent in 1960, to over 60 percent in 1980, to about 70 percent in 2000. The rise may be related to all sorts of circumstances, including economic ones. But it is incontrovertibly related to immigration. According to police sources, over 60 percent of the criminals and over 90 percent of the crime bosses operating on French soil are either foreigners, immigrants, or the children of immigrants.

...Whereas most big French companies have been profitable for years, the French GDP has been growing very slowly or not at all. What this means is that French industry and services derive the bulk of their revenue from activities overseas rather than from the domestic economy. In fact, some companies have already drawn the logical conclusion and moved out: a flagship French company like Renault is now registered in the Netherlands.

As for those remaining at home, they are not able to provide enough jobs for the present working population of approximately 30 million. And so about 9 percent of French residents are unemployed—roughly twice the rate in Britain, Ireland, the Scandinavian countries, Japan, or the United States. Among able-bodied persons under the age of twenty-four, the unemployment rate jumps to 22 percent. To top it off, over 50 percent of today’s jobs are thought to be more “virtual” than “actual,” i.e., they fail the test of rational business management. According to an index compiled by the Organization for Economic Cooperation and Development, the average number of hours “effectively” devoted to work is only 617 yearly for France, as against 801 in Britain and 865 in the United States.

How do the French cope with this? Simple: they rely on an ever-expanding welfare state that takes care of the unemployed, the poor who are beyond any prospect of a viable job, the uneconomical state-run companies, and the supernumerary petty civil servants or “public-convenience” workers. And this does not count the various handouts and incentives, usually in the form of tax rebates, bestowed by the government on companies that agree not to shut down and move elsewhere.

And eventually, everyone who works will work for the welfare state, and everyone who does not work will be paid by the welfare state and cared for by the welfare state. It makes for a nice tautological closed loop, nice and tidy. And if you believe that, may I offer some lovely lunar real estate at a bargain basement price?

The logic of socialism eventually leads to collapse, regardless of the lofty starting point of the wishful populace. France will be no different, and will perhaps crash more quickly due to its absolute need for more immigrants to support all the indigent indigenes on welfare.

Sarkozy cannot save France, because France lacks the will to be saved. If you are an investor, consider the reasons for Renault pulling out.

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Blogger Audacious Epigone said...

A lot here, Al.

Living in the heart of American flyover country, the absurd media slant in political/cultural coverage is easily ascertainable. But when the subject is internationally 'local', I'm more gullible.

NPR's Parisian correspondent certainly made it appear as though Royal was going to pull it off. And the government radio's post-election story was risible. Essentially: The election of the controversial conservative has seen rioting youths in places in France.

Great example of the French company surviving primarily as an MNC doing business outside of France: Viviendi (parent company of Blizzard, maker of WoW).

Is France a harbinger of what is to come in the US? In some ways, I suppose, the US can be seen as having led the way. The US is perpetually ridiculed on the Old Continent for the lackluster performance of its non-Asian ethnic minorities. Yanks must all be a bunch of irrational racists. Well, now France (and the UK) are seeing that it's not so easy. Propositionalism doesn't trump biology (or cultural memes).

Quasi-socialism can function (although it is never optimal) in a high-IQ, affluent, and liberal country. But an increase in the number of bottom-dwellers (North African immigrants) strains the marginally-workable system to the breaking point.

Wednesday, 09 May, 2007  
Blogger al fin said...

The quasi-socialism of the US government is leading to an immense crisis in government debt liability as the populace ages and grows dimmer.

The same thing is happening more quickly to countries such as France that have leaped more deeply into the socialist quagmire. Sarkozy appears to see the problems, but he will likely not have the clout to solve them.

What puzzles me is why a country such as France would choose a tough-minded chap like Sarkozy, when the person full of promises--Segolene--sings her siren songs?

Certainly the US chose Reagan and the UK chose Thatcher when both nations were in difficult economic straits. Are the French just making a last gesture before allowing themselves to sink, or will they follow through?

Wednesday, 09 May, 2007  

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“During times of universal deceit, telling the truth becomes a revolutionary act” _George Orwell

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