Tuesday, February 08, 2005

The French Work Week

The European edition of The Wall Street Journal has an editorial about the fight brewing in France over modifying the mandatory 35-hour work week. Link. (subscription required)
You've got to hand it to the French. No people work as hard or as enthusiastically to avoid work.

For the past two years, politicians, business leaders and trade unions have labored overtime against France's mandated 35-hour workweek. Hundreds of thousands of union sympathizers capped a series of nationwide demonstrations by turning out Saturday, that sacred day of leisure, to denounce government plans to free up the workweek.

For its part, the government studied, debated, and debated some more, before agreeing on an extremely modest reform of seven-year-old work law that Parliament is expected to adopt today. Employees will be allowed to work up to 48 hours a week, the European limit, so long as management and workers strike a deal. This is a start but it falls far short of what France needs to become competitive -- and it's unlikely to go far toward reviving the anemic economy.

This being France, the government wouldn't dare just repeal the most damaging piece of economic policy-making in recent memory. The 35-hour week depressed job creation, chased away investors, eroded the work ethic and cost taxpayers, by one estimate, €15 billion a year.

This being France, too, the Socialists claim their signature law has been a resounding success. To its credit, the government of Jean-Pierre Raffarin has stood firm in the face of the protests, pointing out that in democracies parliaments -- not the street -- make the laws.(...)

More to the point, a growing chunk of the population can't choose to work at all. French unemployment has been stuck at nearly 10% for two decades. The burden falls most heavily on the young and those nearing retirement. Only one-quarter of those under 25 are employed and a third of 55- to 64-year-olds. Those figures are 20 and 16 percentage points, respectively, below the OECD average.

No country in Europe more exemplifies "the European disease" than France. Eliminating trade barriers and instituting a common currency have saved the continent's condition from being even worse, but they are not enough to cure the stagnation caused by policies that long ago crossed over from welfare-statism to socialism. Europe competes in the World, but it is not competing. It will eventually have to decide between two options: build a total trade wall around the EU, locking in stagnation and low living conditions, or starting to truly compete. For the good of the Europeans and the good of the World, I hope they choose the latter.


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