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Home Publications Blogs Beat the Press The NYT Doesn't Like the French Welfare State

The NYT Doesn't Like the French Welfare State

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Sunday, 25 August 2013 16:15

Earlier this year the NYT gained considerable notoriety for claiming the Danish welfare state was on its last legs. While the article included several stories that made this point, the data refused to cooperate. By almost any measure Denmark's economy looks considerably stronger than the U.S. economy.

Having struck out in its effort to push its Danish welfare state scare story, it now appears to be turning its attention to France. An article in today's paper, which was headlined "a proud nation ponders how to halt its slow decline," told readers:

"Today, however, Europe is talking about “the French question”: can the Socialist government of President François Hollande pull France out of its slow decline and prevent it from slipping permanently into Europe’s second tier?

"At stake is whether a social democratic system that for decades prided itself on being the model for providing a stable and high standard of living for its citizens can survive the combination of globalization, an aging population and the acute fiscal shocks of recent years.

"Those close to Mr. Hollande say that he is largely aware of what must be done to cut government spending and reduce regulations weighing down the economy, and is carefully gauging the political winds. But what appears to be missing is the will; ..."

None of these assertions are backed up by any evidence. For example, "Europe" is clearly not talking about the "the French question." Unnamed individuals who the NYT views as important may be talking about the French question, but this is most definitely not a major topic of conversation for people across the continent. What the article is revealing is an agenda that a small group of people, presumably most of whom are wealthy and powerful, have for France.

In the same vein it later tells readers;

"There is a broad consensus that real social and structural renovation can be carried out only by the left."

It never reveals who is part of this "broad consensus." Obviously the consensus does not include the vast majority of French people who clearly do not want to see major changes to French society.

While France undoubtedly has problems, it is not clear that they are more severe than those facing other countries, like the United States. For example, while its overall employment to population ratio is somewhat lower than in the United States, this is entirely due to the fact that younger people and older people are less likely to work in France than in the United States. Its employment rate for prime age workers is actually 5 percentage points higher than in the United States.

FRED Graph

The piece goes on to assert that France can no longer afford its generous social model in the current globalized economy.

"But in a more competitive world economy, the question is not whether the French social model is a good one, but whether the French can continue to afford it. Based on current trends, the answer is clearly no, not without significant structural changes — in pensions, in taxes, in social benefits, in work rules and in expectations."

The piece produces no real evidence to support this assertion. An examination of France's current account, the most obvious market test of its competitiveness suggests that France is not doing too poorly. It has a current account deficit of less than 2.5 percent of GDP. This compares to a deficit of more than 3.5 percent in GDP in the United States. France's exports are also seriously depressed at the moment because the European Central Bank and European Union are forcing a severe recession on several of the country's major trading partners (Greece, Spain, and Italy). If France's trading partners are ever allowed to resume normal growth, this will have the effect of reducing its current account deficit.

The article does some serious straw grasping in trying to build its case, telling readers:

"Large French companies compete globally; there are more French companies in the Fortune 500 than any other European country. But the bulk of their employees are abroad, ..."

It would hardly be surprising that a large French company would have most of its workers outside of France. This is true of many large U.S. companies as well and the United States is a much larger country than France.

The piece even bemoans the fact that France's economy appears to be picking up, which it obviously considers bad news from the standpoint of advancing its agenda for France:

"The turning of the business cycle could actually be a further impediment in that sense, because as the European economy slowly mends, the French temptation will be to hope that modest economic growth will again mask, like a tranquilizer, the underlying problems."

There is a very interesting story here. Obviously wealthy and powerful people want to overhaul France's welfare state. Unfortunately this piece is written from the standpoint of an advocate of their position rather than the standpoint of a neutral reporter.

Comments (16)Add Comment
...
written by bobs, August 25, 2013 6:42
Nice job, Dean Baker!

Can I start a campaign to have the Times hire you as a columnist? You and Krugman... now finally something to look forward to when I read the NYT!
Thanks, been waiting for this since this morning
written by Bob Lucore, August 25, 2013 7:28
As soon as I read the Times piece my blood pressure rose. Then I went over to Bezos on 15th and it wasn't good for my health either. Thanks, Dean, for restoring my personal equilibrium.
Too right
written by Nancy Cadet, August 25, 2013 9:03
Thanks for the analysis with facts. The NYT article seemed thin and lacked substance; it was just pushing the usual anti-worker protection, anti-social welfare opinions. I know there is a stalled economy , a lack of jobs for young graduates , and a shrinking of the manufacturing sector-- what's new ? The idea that only the left can change labor legislation is ridiculous , and the final quote I. The article from aWWII resistance fighter is absurd .

Can NYT ever employ a reporter who isn't anti union?



...
written by watermelonpunch, August 26, 2013 1:20
"modest economic growth will again mask, like a tranquilizer, the underlying problems"


'Cause obviously I'm thinking any "underlying problems" have to do with the economy not being good, and any economic improvement wouldn't unmask those problems, it would alleviate them.
So I guess there's some story of "other" so-called underlying problems.
Can someone fill in the crackpot unspoken innuendo here for me? Because I'm having trouble connecting the dots from various & sundry other conspiracy theories, half-baked misinformation, marinated in fear, and lightly seasoned with a grain of truth.
Ah, the glory that was France
written by Kat, August 26, 2013 6:25
Remember the young Alain Simpson leading the youth of '68 with the rallying cry "Fix the Debt!". What could have been.
Instead, today they find themselves #28 on the International Institute for give- the- CEO's- whatever- they- want- list.
How 9-11 Changed Journalism Forever
written by Last Mover, August 26, 2013 8:58

Ah yes, the triumphalist drumbeat of Freedom Fries over French Fries never wanes among patriots in journalism does it.
Race to the bottom
written by madmamie, August 26, 2013 12:41
The real consensus in France is that Holland is a traitor to his party's values. Like Obama, he is surrounded and advised by the very people whose agenda it is to destroy France. The truth is that France and a few Scandinavian countries are the only (weak) obstacles remaining between us and the new world order.

Thank you Dean Baker for pointing that out.
Erlanger and work hours
written by Brumanuensis, August 26, 2013 1:07
Excellent article, as ever Dean.

Another oddity - that's the polite way to describe it - in Erlanger's piece, was this section:

"When the French work, they work hard; labor productivity, perhaps the single most important indicator of an economy’s potential, is still relatively high, if dropping. But with long holidays and the 35-hour week, the French work fewer hours than most competitors, putting an extra strain on corporations and the economy".

Erlanger compares France unfavourably with Germany and the UK, in terms of competitiveness. Yet consider the average yearly hours worked by Germans, British and French workers, in comparison to one another:

France - 1479

Germany - 1397

The retirement age in France is around 60. The average retirement age in Germany is around 61. In Greece, it's 62. Presumably Erlanger thinks Greece is a dynamic hub of economic activity.

Similarly, Erlanger implies that the 35-hour week is the norm in France. Anyone who has worked in France could have told him this is nonsense, but luckily there's independent corroboration too, as the average work week is nearer to 40 hours, than 35 - I would post the link, but I'm limited to 1 per post.

(All figures from the OECD, 2012 - http://stats.oecd.org/Index.aspx?DatasetCode=ANHRS )
Forgot to add UK data
written by Brumanuensis, August 26, 2013 1:13
For the UK, the average retirement age is around 63 and the average annual workload is 1654 hours.

Also, by 'all figures', I was referring to annual work hours.
madmamie
written by David, August 26, 2013 1:18
... means the new world DISorder. These jokers couldn't govern their way out of a paper sack. Too bad they have to drag us all down with them to prove it.
stats are interesting truth may be different..
written by pete, August 26, 2013 4:53
I have heard nothing but horror stories about French attitudes toward work. When the tele company when private, and "workers" had to actually "work" some became quite depressed. A survey I recall revealed that a good government job was what parents wanted for their children. They are living on borrowed time.

Compare to say, South Asia, where work is a blessing, not a curse. In Thailand, e.g., there is very little unemployment, everybody does something, and often 6 days a week. In fact with low restrictions there is a shortage of labor, for example not enough truck drivers...They welcome the Burmese, who speak better English, as compared to the vitriol delivered by unions and limbaughs et al. against our southern neighbors. Gosh back one day and I miss being able to hop on an illegal motorbick, or tuk tuk, both of which OSHA or somebody like the taxi drivers would frown on. In Bangkok there is symbiosis. Taxis for the wealthy, motorbike rides for the less wealthy. Tuk tuks everybody uses. Lax regulation can be a blessing.
pete's right (Again!)
written by AJ, August 26, 2013 6:07
Lax regulation, now that's what we need more of!

Let's start with zoning. Enough of this telling people what they can do with their own real property! I want to be the first to buy up the land next to pete so I can start up my new fusion business: Coal-fired power plant/strip club. It's a can't-lose proposition. Think about it, pete! You'll live right next door and will save all that commuting time/expense that everyone else will have.

And all those "safe"-food regulations. We'll start with pete's town. I mean, yes, your daughter might die of ecoli poisoning at a fast food joint, but think, pete, of all that she will have done to help the "market". Now no one will go that fast food place ever again. It's not like she will have died in vain. She will have died so that the market can function better. It's utility. Paradise even.
...
written by Donald, August 26, 2013 7:29
I'm not going to go looking for them, but the NYT has been writing this kind of story for a long time--probably for as long as I've been reading them (since the late 80s). They hate the idea of an economy where ordinary people live comfortable lives and without having to kowtow to the corporations. I'm not sure what sort of "liberalism" this represents, but it's been the NYT brand for a very long time.
...
written by watermelonpunch, August 26, 2013 11:49
@ AJ - it's possible pete lives in TX & is already pretty much almost as you describe.
I've heard some places are kind of like that already. Albeit I don't know that the strip club owner & the coal plant manager would be the same person (ha ha)... but they're probably pals.
I remember reading about some neighborhood in some Texas city where packed into a small area was a metal galvanizing plant, condos, apartment buildings, an animal shelter, and a steak house... or some combination like that. Real crazy. No parks, no trees, etc. The no trees part really stuck in my mind. Like stick an airport flight path over the top of it, and a neighbor who cooks meth & likes to use circular saws early in the morning and it could be the setting for an "and then he went mad" torture porn movie thriller.
Odd thing about it, it's apparently in one of the more successful cities (or near), where housing prices have been really climbing lately. Which really makes you wonder if something hinky is going on with that.
Maybe the youth of today really doesn't mind the idea of living in an airtight soundproofed prison in a noisy stinky neighborhood. Or maybe they feel they have no choice.
i have a daugher? oh my gosh....
written by pete, August 27, 2013 10:37
seriously, we have plenty of ecoli going around these days with plenty of safety regulation...fake fish, etc. just amazing what people think they are getting. in addition, e.g., the fda keeps life saving drugs from folks on an experimental basis...

anyway I think we can make a choice to ride on a motorbike or a tuk tuk. even dallas (taxi drivers) is going after uber....so it aint exactly the wild west in TX. plus the drug laws are not exactly libertarian.
...
written by Col Bat Guano, August 29, 2013 5:50
So pete, because there is already some e coli around we should just give up and let more into the system. Freedom!

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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