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Running on empty

2010-10-21 12:15:40

Oct 18th 2010, 16:33 by The Economist online | PARIS

THE strike-weary French have grown used to infrequent trains, absent teachers, undelivered post and unprinted newspapers. This is the routine whenever unions hold a one-day strike, as they are due to (again) on Tuesday October 19th, against the raising of the legal minimum retirement age from 60 to 62 years.

But the petrol shortages that have spread across the country in recent days, prompting long queues at the pump, are a different matter. A week-old strike now touches all 12 of France s refineries. With lorry drivers and school pupils also staging improvised demonstrations, France is facing a hardening of protests in what will be a crucial week in determining the fate of the pension reform.

On October 18th President Nicolas Sarkozy called ministers to a crisis meeting to work out a strategy for guaranteeing petrol supplies. France has begun to tap its industrial stocks, and fuel supplies to the main Paris airports have been resumed after a stoppage, although pilots were advised to refuel abroad where possible. Yet despite the government s insistence that there would be no petrol shortages, some 500-1,000 service stations are running low on stocks or have run dry altogether, according to the Union of Independent Petrol Importers, which supplies hypermarket stations.

Lorry drivers have joined the striking oil workers, organising slow-moving convoys that block motorways, in what is known as operation snail . Pupils from hundreds of lyc es, too, are disrupting schools, ahead of tomorrow's strike, in which turnout is expected to be high (anything between 1.2m to 3.5m took to the streets in the previous one-day strike last week). Fewer trains are running even before the strike begins.

This week is crunch time for both sides. For those on strike, time is running out to stop the pension-reform bill going through. It has already been passed by the lower house of parliament, and the upper house is due to conclude its voting this week. Leaders of the hardline unions, including the communist-backed Conf d ration G n rale du Travail, the country s most powerful, are under pressure from their grass-roots not to cave in. Some argue that, even if the upper house approves the bill, protests should continue; there are further legislative steps before the bill becomes law. There is precedent for such a move: in 2006, student-led protests against a proposed labour reform forced the government of the day to retreat even after it had been signed into law.

For its part, Mr Sarkozy's government is hoping to keep a lid on protests and a grip on petrol supplies until the end of the week. By then, not only should the bill be passed by the Senate, but schools will have broken up for a ten-day half-term. French unions like their holidays too much to organise strikes during the school break. Mr Sarkozy has already made some concessions on the margin, such as allowing more generous rules for women who take time out for maternity leave. But he has repeatedly said that he will not budge on the retirement age itself.

Much depends on whether organised protest turns into disorganised chaos. The petrol shortages are a worrying sign. French governments, haunted by 1968, are always nervous when students take to the streets. Though the pension reform does not touch students, it has become a touchstone for general grievances and a pretext for troublemakers to join in. Schoolchildren have been egged on by some opposition Socialist leaders, including S gol ne Royal. One pupil was hit in the eye by a police flash ball last week.There have been other sporadic clashes with police.

Should the demonstrations fizzle out by the end of the week, amid popular exasperation, the trick may well lie in finding a way for the unions to save face. Should they spin out of control, however, Mr Sarkozy could find his plans to reshuffle the government once pension reform is passed will have to be put on hold.

jolyonwagg1 wrote:

Oct 18th 2010 8:06 GMT

If the French want to go ahead and completely bankrupt there own country instead of serious reforms to there pensions and bloated public sector,then go on ahead;but please do not ask the rest of Europe to bail you out when you are bankrupt like the Greeks?

willstewart wrote:

Oct 19th 2010 9:13 GMT

The reforms DO touch French students (& possibly those in the wider EU).

These students will have to pay their parents' pensions for many extra years when they could be still working. Someone should point out to the students that they are on the wrong side!

Vive_chimie wrote:

Oct 19th 2010 9:30 GMT

Many students here (I live in France) claim that the proposed changes to the retirement age will affect them more directly than the comment by willstewart implies. These students reason as follows:

(1) There is currently high unemployment and it's very difficult for the young to find a real job.

(2) If "the old" have to stay longer in the workforce than they do at present, this will only reduce the number of jobs available for the young.

(3) Therefore this proposed pension reform will increase youth unemployment even further.

I know that the economy is dynamic, that the number of jobs isn't fixed (lump of labour fallacy, etc), but I have to admit that I have serious difficulties persuading students to see that. Does anyone have good pedagogical examples to which they could point?

Thanks in advance.

balloonair wrote:

Oct 19th 2010 9:38 GMT

The worst part about the Greek crisis is whenever a government fails or avoids implementing even a mild cost reducing measure everyone screams about how Greek style bankruptcy is imminent or at least unavoidable in the long term. Par for the course that his discussion started similarly.

Maybe paying your parents' pension is an acceptable compromise if it means you get to retire earlier as well. In either case, fear mongering over future deficits is futile given that there are thousands of variables that could change within the next 30 years, such as immigration, unexpected technology and productivity boosts etc. Raising the retirement age somewhat would be prudent but if it paralyses the whole country for weeks on end it might turn out to be simply counter productive. Sometimes the cost of stopping inertia is greater than the benefit.

Prakhar Singh wrote:

Oct 19th 2010 9:43 GMT

The people of France got it right! Forbes just came out with the top 10 cities to live and own a business. None are in America. France and Germany top the list. All ten cities are in countries with universal healthcare, high labor representation, free higher education and over 50% tax rates on the wealthiest.

Sweetdigit wrote:

Oct 19th 2010 10:59 GMT

The joyful singing, the beating drums, the rush of excitement as the crowd moves down the avenue and the feeling of belonging to the group of rebels against an authoritarian government. Of course it's easy to understand why people love protesting. It's so much better than the boring economics class for students or the daily drudge for (nearly only government) workers. Though it is selfish to others in the country, why forgo such great occasion to party?

For one, because most of the country agree on the fact that retirement age should increase (53% per The Economist's sources), and after all, Sarkozy was elected on a promise to push through precisely this kind of reform. In this matter, the need for reform comes down to simple maths which I am sure the party leaders are not oblivious to - but maybe this is just too good occasion for them to finally hold power, which they might never see in their government jobs.

Just to say that there are many factors which motivate people to go down to the streets and protest. Some earnestly have a different assessment of the situation than the government and think the reform will damage France. For those people, I respect their right to go on peaceful protests. Others just want to wreak havoc.

I just wish the voice of the silent majority could finally be heard.

Only holidays, or maybe the bad weather I see outside the window will douse this fanfare.

ralphdazert wrote:

Oct 19th 2010 11:15 GMT

@ jolyonwagg1: hear hear!

If the French bankrupt their country by their stupid strikes, that's fine by me, but don't expect Northern Europe to bay the bill. We have plenty of problems ourselves. BUT, their is one big difference: the population in Northern countries like Germany, Netherlands largely recognises the need to take cuts. If times are bad, one can't hold on to luxuries of the past. But not the French: just keep holding on to jobs for life, retirement at 50 and 4-day weeks, French boys and girls! The real world won't wait for you!

willabytrumpton wrote:

Oct 19th 2010 11:37 GMT

I wonder for how long people have said "the French socio-political economic model is unsustainable, nothing short of pure capitalism can save this country from imminent ruin".

The French constantly pride themselves on going against the "anglo-saxon" model (an apparently purely French concept). However the economy here works and it remains one of the most productive countries in the world.

Sure it could work "better", but it works.

I am regularly surprised that it does, but then reality is always more complicated than economic theory.

oommenz1 wrote:

Oct 19th 2010 11:41 GMT

Raising the age limit to 62 for retirement is the better way for reforms. The citizens of France need to introspect this as the only best way for financial discipline.

I vote for the reforms initiated by the govt. reforms are no doubt painfull. But thats the best for the people of France.

NullAleph wrote:

Oct 19th 2010 12:10 GMT

The French state has never learned how to coopt or engage or even trust its own people with any part of the political process, nor how to educate them to economic literacy. As a result, political decadence is coupled with a profound entitlement culture and stupefying economic ignorance.

When your parliament is a rubberstamp joke, your rulers are unelected technocrats, and most levels of government are appointed out of reach of the electorate, then you take to the streets because that's the only place you own.

Darion X wrote:

Oct 19th 2010 12:14 GMT

willabytrumpton wrote: Oct 19th 2010 11:37 GMT

+++++++++++++++++++++++++++++++++++++++++

Hmm, as a German I must tell you that we know this term to ##-->

"anglo-saxon" model <--##.

And that it works, hmm, odd statement to me. I thought the UK had also big problem and the number of youth unemployed is as far as I know also not low.

Now I don't want to defend the french and their strikes - I find them stupid but this statement seemd odd to me nonetheless.

Darion X (Germany)

Tamas Czinege wrote:

Oct 19th 2010 12:27 GMT

Prankar Singh: I will take Forbes's opinion about German or French cities being the World's best places to "live in and own a business" seriously when they move their headquarters from the Fifth Avenue in Manhattan to Berlin or Paris.

As for the topic, it's incredible that 50 years after the post-war labour shortages, unions have still that much power in France. It's simply idiosyncratic, hence it cannot stay like that.

Swiss Reader wrote:

Oct 19th 2010 1:29 GMT

@Vive_chimie - a way to explain matters to your students may be to ask them where the money for the pensions is supposed to come from. The answer is obviously from the people who work, via "social charges". Those social charges make labour more expensive and discourage employment, rather than helping young people to find jobs.

Your students' reasoning would make sense if the money for pensions would be paid by somebody else; however it is doubtful whether the Germans could be persuaded to foot the bill...

MaxC75 wrote:

Oct 19th 2010 1:34 GMT

The problem here is not just pension reform - many of the people protesting are actually protesting the excesses of the Sarkozy presidency: the Bettencourt/Woerth scandal, the Kerviel/Soci t G n rale judgement, the attacks on the Rom population, the Jean Sarkozy/EPAD scandal, the fiscal shield ("bouclier fiscal") and more generally the Berlusconification of French politics.

This is quite worrying because it means that the protesters don't really know what they want, apart from "out with Sarkozy", and the Government, even if it wanted to, can't give them what they want. Therefore, which way out of this crisis?