Sunday, June 13, 2010

Thoughts on French strikes and the PIIGS economic situation


Getting caught up in one of the regular French strikes on the railways (or anything else for that matter) caused me to talk with Peter about French attitudes and their workers expectations. In another post I mentioned the amount of vacation that most people in France are entitled to, and I learned more about the apparent inflexibility that most unions have to change. They appear to be highly protective of the workers and the jobs that they have and pretty much to hell with anyone else. It is incredibly difficult to fire anyone even if they are grossly incompetent, and there is level of mistrust between workers and management that is not seen elsewhere. The end result is that employers look for ways to automate jobs, and will do about anything to not increase the workforce, and international companies like Caterpillar and Volvo would likely not give France a second look as a potential site to expand or relocate a part of their business.
The unemployment rate amongst young people, particularly the disadvantaged youth in the northern Paris suburbs like St Denis, who are mainly of North African descent is about 45% and a proposal a couple of years ago to modify job tenure laws to improve their chances was defeated by the unions. I will find a way to link to the article as it is indicative of a larger problem that Europe is just beginning to come to terms with.
Link to the article referenced above
The other thing that struck me was that to a large extent the way of life in the villages and small towns has not changed substantially. Small farms still dominate the landscape and school kids still come home for lunch. Shops close for an hour or two in the middle of the day and close at 12 on Saturday for the weekend.
You could well argue that they are the smart ones and those people who take 20 minutes for lunch, or even worse, eat lunch at their desk are the ones who need to change. In a perfect world that is probably true, but in the world of cost cutting, job cutting and outsourcing to India, China and Malaysia it cannot be sustained.

We have just had the Greek currency crisis, and that is likely the first of many as the PIIGS (Portugal, Italy Ireland Greece and Spain) finally realize, along with the UK and the USA that life as we know it will be fundamentally changing. Greece has a huge public sector employment and a lousy rate of people actually paying their taxes, and I suspect that most of the others will have similar problems that will have to be tackled at some point. I just read an interesting article about why more people should be audited. It might be a useful strategy for some of the PIIGS countries
It will be interesting to see what David Cameron comes up with in his emergency budget in the UK on June 22nd (I think).
Does Britain really need nuclear submarines and new tanks? Wars do not seem to be fought that way anymore, it is more by drones over Afghanistan operated by someone sitting at a console in Tampa Florida.
What started out as an observation of life in France has morphed into a more general rant over the serious economic situation we are ALL in. I hope my pension survives!!