French presidential primaries

[Chessmistress]

Doing "something"?
So, as long as an unspecified "something" is done, then you're fine with it?
There are MANY VERY DIFFERENT "somethings" that can be done.

Studying the possible solutions is a good thing. Ignoring the problem never works.

Raising the retirement age is a pretty stupid solution, for a good reason: raising the retirement age is the standard solution when there are too many elder people compared to younger people due lack of births in the past 20 years.
French system isn't in crisis due lack of births, there are enough young people to pay elders' retirement.
The problem is due lack of jobs, and so in such situation raising the retirement age is not going to work because you basically keep more expensive elder people while keeping cheaper younger people unemployed.

[Neu Leonstein]

Raising the retirement age is a pretty stupid solution, for a good reason: raising the retirement age is the standard solution when there are too many elder people compared to younger people due lack of births in the past 20 years.
French system isn't in crisis due lack of births, there are enough young people to pay elders' retirement.
The problem is due lack of jobs, and so in such situation raising the retirement age is not going to work because you basically keep more expensive elder people while keeping cheaper younger people unemployed.

How good then that Macron doesn't propose raising the retirement age. His plan is to take all the different pension systems that exist right now and consolidate them into the same thing, hopefully generating efficiencies in the process that save money and reduce disparities across workers who have access to different schemes.

I get this sense that you think he's some sort of pro-market fanatic. Which is understandable, I suppose, given how people in the opposing campaigns have portrayed him. But his program is primarily about making the things the government does work better, and expanding them in areas where it can help people access the labour market and a global economy. It's not about making the government do less.

I'm happy to expand further on what I think doesn't work so well in the French labour market and what he might do to address it, if you would like to go into that. But as a general point, I'm not sure that a lot of his proposals are really things that socialists should naturally disagree with.

[Arkinesia]

Doing "something"?
So, as long as an unspecified "something" is done, then you're fine with it?
There are MANY VERY DIFFERENT "somethings" that can be done.

Studying the possible solutions is a good thing. Ignoring the problem never works.

That's what I was getting at. The opposition to Macron has far too often said that the best way to deal with the obvious problems in France's pensions is to just ignore the problem, which will do naught but make it worse.

[Kilobugya]

That's what I was getting at. The opposition to Macron has far too often said that the best way to deal with the obvious problems in France's pensions is to just ignore the problem, which will do naught but make it worse.

That's just wrong. No one ever said to ignore the problem, be it political parties from the left of Macron or the right of Macron, or the unions. What they propose to do is different, can be very fuzzy (like FN's proposals), and might have issues, but no one says the problem should be ignored, and pretending so is just strawmaning.

[Chessmistress]

Raising the retirement age is a pretty stupid solution, for a good reason: raising the retirement age is the standard solution when there are too many elder people compared to younger people due lack of births in the past 20 years.
French system isn't in crisis due lack of births, there are enough young people to pay elders' retirement.
The problem is due lack of jobs, and so in such situation raising the retirement age is not going to work because you basically keep more expensive elder people while keeping cheaper younger people unemployed.

How good then that Macron doesn't propose raising the retirement age. His plan is to take all the different pension systems that exist right now and consolidate them into the same thing, hopefully generating efficiencies in the process that save money and reduce disparities across workers who have access to different schemes.

Reduce disparities across workers who have access to different schemes
+
Saving money
=
Higher average retirement age

Exactly what I said.

I'm happy to expand further on what I think doesn't work so well in the French labour market and what he might do to address it, if you would like to go into that.

Sure, you're welcome.

That's what I was getting at. The opposition to Macron has far too often said that the best way to deal with the obvious problems in France's pensions is to just ignore the problem, which will do naught but make it worse.

That's just wrong. No one ever said to ignore the problem, be it political parties from the left of Macron or the right of Macron, or the unions. What they propose to do is different, can be very fuzzy (like FN's proposals), and might have issues, but no one says the problem should be ignored, and pretending so is just strawmaning.

Indeed.
Saying that Macron is the only one who wants "to do something" is just parroting the propaganda presenting him as a savior.

[Kilobugya]

How good then that Macron doesn't propose raising the retirement age. His plan is to take all the different pension systems that exist right now and consolidate them into the same thing, hopefully generating efficiencies in the process that save money and reduce disparities across workers who have access to different schemes.

That's part of his plan, and a part I could agree with in theory. If it was not done, as Macron will likely do, by aligning the rights to the worst common denominator - like typically the "special regimes" of retirement in some fields (say, train drivers) have a lower retirement age, but also a lower compensation rate. Macron will typically put the train drivers to the same retirement age than the rest, but leaves the lower compensation rate.

But that's only a part of his plan - not the worst. The worst parts of his plans are :

1. Moving more towards a capitalization system and less towards a redistribution system, which is highly harmful in many ways (it makes workers more vulnerable to stock market crisis, it contributes to having a huge amount of speculating money that creates bubble which then burst, it puts more pressure on companies to deliver short-term profit instead of thinking long-term, ...).

2. He wants to move towards a "point" system, where the retirement will be more individualized among your whole career - comparing to the current system that only looks to your ~10 (depending of public/private, ...) years. That will greatly penalize people who have had period of unemployment, of sickness, and women who more often work part-time.

I get this sense that you think he's some sort of pro-market fanatic. Which is understandable, I suppose, given how people in the opposing campaigns have portrayed him.

Not just how the opposing campaigns have potrayed him - but also what he did during the 2 years in which he was minister (the "Macron law", with the complete failure of his deregulation of transport, the "El-Khomri law" in which he participated and he supported, ...) and the way he speaks - like pretending that employers have a "more difficult" life than workers (while facts show the exact opposite however you look at it).

It's not about making the government do less.

Well, wanting to reduce the number of public workers by 120 000 and state spending by 60 billions, in addition to wanting deregulation, is "making the government do less" however you try to hide it.

I'm happy to expand further on what I think doesn't work so well in the French labour market and what he might do to address it, if you would like to go into that.

The mere fact of thinking about it in term of "labour market" is already being a market fanatic. As Lenin Moreno (elect-president of Ecuador) said, "workers are not merchandises, they are subjects of right". Looking at working code and workers protection in term of "labour market", like you have an "energy market" or a "cereal market" is framing the whole issue in a wrong way. Sure, we need a working economy and a somewhat efficient allocation of workers. But workers are people, subjects of rights, and improving workers' well-being is actually the _goal_.

So if having a slightly more effective allocation of workforce (which itself is far for being proven, but well) means seriously degrading working conditions and workers' life, that's a very bad thing to do. Protecting workers against abuses from employers (like unpaid extra hours, sexual harassment, or dangerous work conditions) is more important that a slightly better economy. And allowing people to plan ahead their lives by having protection against being fired next day is also very important. Saying "labour market" completely ignores the fact that firing a worker often means depression, breaking a family, sometimes even suicide. And if France has a relatively high natality rate, it's in part because we have a protective working code, allowing people to plan ahead their life, and therefore take the "risk" of bringing a child to life, because they know they are more likely to be able to take care of him (by having job safety, by knowing they won't have to work on sundays, by knowing they are not likely to get the father and the mother forced by the employer to move to two different regions, ...).

[Neu Leonstein]

Reduce disparities across workers who have access to different schemes
+
Saving money
=
Higher average retirement age

Exactly what I said.

That's not necessarily the case though. A caveat to start out with is that I don't speak French, and so I'm unable to read Macron's proposals in the original. I'm also not an expert on how France's pensions work, so I'm just working with what I'm able to pick up off google searches and the like.

According to the Economist, there are currently 35 public pension systems in France. That's a lot of systems that need management structures, separate accounts, investment committees, paperwork and so on. In other words, it's a lot of duplication. That could go and save some money. It can also make planning for future sustainability easier if there's one system for everyone. It looks like he's going for efficiency gains more than anything.

But he has made it very clear that he doesn't intend to raise the retirement age. That's on the reasons actual neoliberals criticise his program, given that it still is unusually generous relative to other countries and likely won't do that much to change sustainability one way or the other.

Sure, you're welcome.

Ok. A few numbers to start with:

• France's unemployment rate is around 9.6%. Its youth unemployment rate is around 23-24%. France doesn't really collect statistics on people with non-French ethnic backgrounds, but what surveys people have run suggest that unemployment rates for people from African backgrounds are more than double those of people without immigrant roots. (note here that the survey was run by Jean Pisani-Ferry, who is now the brains behind Macron's policy program)
• France's labour market participation rate is somewhere around 55%, substantially lower than in, say, Germany or the UK. Again, the numbers get worse if you go towards more socially vulnerable groups.
• It's true that France has a substantial labour law code that protects a lot of benefits for those with stable jobs. Work hours are a thing maybe, but actually the difference between average weekly hours worked in France and other countries is not that big. But there are substantial other protections in place as well, and they really do take a lot of risk out of the lives of the permanent workforce in France. Which is a good thing: it's one of the major achievements of social democracy. Unfortunately, as with the other statistics, the young and more socially vulnerable groups struggle more. About 60% of employment for people aged 15-24 is on a temporary contract basis, and that number is still in the 10-15% range for people aged 25-54. In the UK, those numbers are closer to 15 and 5% respectively.
• But France is hardly a poor country, and though growth could be better, it's generally okay. The logical consequence is that labour productivity (i.e. the average output produced per worker) is really quite good. To the extent that wages reflect this, they're also pretty good.
• The long-term unemployed in France don't live like kings. There's an unemployment insurance system, but my understanding is that its benefits are temporary. You also cannot leave voluntarily and receive unemployment insurance. Once your claim on the insurance runs out, you get a type of minimum income... enough to survive on perhaps but not to live well. This is, for example, very different to what Germany looked like before the Hartz IV reform.

So like I alluded to before in this thread, you have effectively two different labour markets in France. There's the one for those with stable, long-term positions. They get paid well, get a lot of holidays and a somewhat shorter working week and are pretty well-protected against sudden termination. And then there's another labour market, which is those who are latecomers, who don't do so well in school, who are from the wrong ethnic or cultural backgrounds. They struggle to break into these more permanent, well-protected jobs. Instead, their fate is more likely to involve temporary work with much less stability and benefits and fewer opportunities for advancement. So again, this hits the young and socially vulnerable groups the hardest. And those groups are for whatever reason concentrated in particular places too, making escaping from them even harder. The result are banlieue-type places that bring with them all sorts of other problems. "Uberisation" might be a dirty word in France (as it is in many other places), but if the alternative to the gig economy is at best a temporary contract to replace a permanent worker on maternity leave, some people might have little choice.

I think that's the way to think about the French labour market and any attempts to reform it. Conditions are really pretty good for people on long-term contracts. They're not so good for people who aren't on those contracts, and this systematically disadvantages some parts of French society. Many of those people are sick of their temporary contracts too, and "flexibility" is not necessarily a word they like to hear anymore, after having been job-hopping for years (if they're lucky!).

And on top of all of this you have the same pressures on the labour market that you have everywhere else. Automation and trade change the mix of skills that are in demand more quickly than people can change their own ability to supply them. The result is people losing jobs, even permanent ones, and then falling into the same trap where now they can at best hope for temporary spots to open up.

So what to do about all this? Macron's stated goal is to move towards more of a 'Nordic' model for the labour market. That means less job security for workers and more flexibility for companies, but more state support for those who do lose their jobs in order to minimise the time spent out of work.

The labour law reform that Macron is being attacked for tried primarily to get at the flexibility aspect to make permanent contracts more attractive for businesses, so that they might at the margin use those rather than getting temp workers. If you hire a permanent worker and things go wrong, the risk is all yours - your obligations to the worker you just hired remain as substantial as ever... basically until you go belly-up. Naturally if you're not quite sure, you might opt for a temporary worker instead, because she represents a more flexible cost to you. But necessarily changing that trade-off means softening some of the protections implied in those permanent contracts (specifically to this case, increasing overtime caps and capping compensation for unfair dismissal). Another aspect, and obviously quite unpopular, was a rule that would effectively allow a business to renegotiate existing contracts at worse conditions for workers if it can show that the jobs would be lost otherwise. There are a few other technical changes but I think those were the main ones people took exception to. The reaction was a recurring theme in these sorts of disputes. Basically, people understandably hate having some of their job security removed, and so modifying the existing system of long-term contracts is extremely difficult.

From what I understand Macron's program to be, he's more recently talked more about the supply side of the labour market (probably understandable, given he was trying to win an election). So spending more money on education and retraining, making you eligible for unemployment insurance even if you leave your job voluntarily to try and look for something else. That sort of thing. But I suspect that sooner or later the demand side, and the flexibility issue, will come up again. The key is to be able to explain what is being done and why. As I mentioned earlier in the thread, in polls a majority of French people actually do think that reforms are necessary. They just have to be convinced that these particular reforms are sensible, and that will be one of Macron's big political challenges.

And if you don't agree with the destination he wants to get to, then I think the real challenge is to lay out an alternative. Broadly speaking, I see only two. One is to do very little, and continue the two different labour markets, with a relatively well-protected set of people on permanent contracts, and a large and likely growing class of people who are left out. The other is to come up with a realistic proposal that would see companies start hiring large numbers of people on permanent contracts with all the trimmings, reducing the reliance on temporary contracts and gradually getting labour market participation higher. So far, nothing that's been done seems to have offered a hint as to what this proposal might look like, and even proposals that rely on mass nationalisation and some version of forced hiring seem reliant on stories from socialist countries which, in the end, struggled to maintain living standards. Meanwhile, life in Denmark doesn't seem so bad.

[Minoa]

Source: http://www.bbc.co.uk/news/live/world-europe-39900179

Cela commence !

Isn't that the right word for "It begins"? At least the next President wasn't from the party riddled by racial hatred.

[Chessmistress]

Reduce disparities across workers who have access to different schemes
+
Saving money
=
Higher average retirement age

Exactly what I said.

That's not necessarily the case though. A caveat to start out with is that I don't speak French, and so I'm unable to read Macron's proposals in the original. I'm also not an expert on how France's pensions work, so I'm just working with what I'm able to pick up off google searches and the like.

According to the Economist, there are currently 35 public pension systems in France. That's a lot of systems that need management structures, separate accounts, investment committees, paperwork and so on. In other words, it's a lot of duplication. That could go and save some money. It can also make planning for future sustainability easier if there's one system for everyone. It looks like he's going for efficiency gains more than anything.

This is propaganda.
France have a basic public system + various private retirement systems.
Macron isn't going to unify the private systems, nor it would make sense.
The only thing that can be unified is the public CARSAT (caisses d'assurance retraite et de santé au travail - retirement and occupational health funds), that is national but on regional level (there's also another thing in the Paris department, also public) - there can be some savings, but not so much.

Sure, you're welcome.

Ok. A few numbers to start with:

• France's unemployment rate is around 9.6%. Its youth unemployment rate is around 23-24%. France doesn't really collect statistics on people with non-French ethnic backgrounds,

Because it would be racist.

but what surveys people have run suggest that unemployment rates for people from African backgrounds are more than double those of people without immigrant roots.

Probably it's even more, and that's normal.
France isn't USA: in USA a black is an American since many generations, someone who have been taught in the same schools of whites, and comes from the same American culture.
Immigrants in Europe shouldn't be compared to black Americans, it's a very different situation: immigrants come from very different cultures, have very different skills and education.

Do you think that someone who completed secondary education in Mali is comparable with someone who earnt a degree in France, when it comes at having marketable skills?

(note here that the survey was run by Jean Pisani-Ferry, who is now the brains behind Macron's policy program)

France's labour market participation rate is somewhere around 55%, substantially lower than in, say, Germany or the UK. Again, the numbers get worse if you go towards more socially vulnerable groups.

It's true that France has a substantial labour law code that protects a lot of benefits for those with stable jobs. Work hours are a thing maybe, but actually the difference between average weekly hours worked in France and other countries is not that big. But there are substantial other protections in place as well, and they really do take a lot of risk out of the lives of the permanent workforce in France. Which is a good thing: it's one of the major achievements of social democracy. Unfortunately, as with the other statistics, the young and more socially vulnerable groups struggle more. About 60% of employment for people aged 15-24 is on a temporary contract basis, and that number is still in the 10-15% range for people aged 25-54. In the UK, those numbers are closer to 15 and 5% respectively.

But France is hardly a poor country, and though growth could be better, it's generally okay. The logical consequence is that labour productivity (i.e. the average output produced per worker) is really quite good. To the extent that wages reflect this, they're also pretty good.

The long-term unemployed in France don't live like kings. There's an unemployment insurance system, but my understanding is that its benefits are temporary. You also cannot leave voluntarily and receive unemployment insurance. Once your claim on the insurance runs out, you get a type of minimum income... enough to survive on perhaps but not to live well. This is, for example, very different to what Germany looked like before the Hartz IV reform.

I know that Macron wants to reduce the security of more stable jobs to the level of unstable and unqualified jobs, I don't need his official reason for doing that, I know it yet.
I just don't think that such move will be beneficial.

So like I alluded to before in this thread, you have effectively two different labour markets in France. There's the one for those with stable, long-term positions. They get paid well, get a lot of holidays and a somewhat shorter working week and are pretty well-protected against sudden termination. And then there's another labour market, which is those who are latecomers, who don't do so well in school, who are from the wrong ethnic or cultural backgrounds. They struggle to break into these more permanent, well-protected jobs. Instead, their fate is more likely to involve temporary work with much less stability and benefits and fewer opportunities for advancement. So again, this hits the young and socially vulnerable groups the hardest. And those groups are for whatever reason concentrated in particular places too, making escaping from them even harder. The result are banlieue-type places that bring with them all sorts of other problems. "Uberisation" might be a dirty word in France (as it is in many other places), but if the alternative to the gig economy is at best a temporary contract to replace a permanent worker on maternity leave, some people might have little choice.

I think that's the way to think about the French labour market and any attempts to reform it. Conditions are really pretty good for people on long-term contracts. They're not so good for people who aren't on those contracts, and this systematically disadvantages some parts of French society. Many of those people are sick of their temporary contracts too, and "flexibility" is not necessarily a word they like to hear anymore, after having been job-hopping for years (if they're lucky!).

And on top of all of this you have the same pressures on the labour market that you have everywhere else. Automation and trade change the mix of skills that are in demand more quickly than people can change their own ability to supply them. The result is people losing jobs, even permanent ones, and then falling into the same trap where now they can at best hope for temporary spots to open up.

So what to do about all this? Macron's stated goal is to move towards more of a 'Nordic' model for the labour market. That means less job security for workers and more flexibility for companies, but more state support for those who do lose their jobs in order to minimise the time spent out of work.

Macron cannot implement the Danish model.
There isn't enough money for that: the Danish model is very expensive because it includes a lot of support, through money and even more in retraining.
France have a public debt that is 96.5% GDP
Denmark is at 39.6% GDP
It's a 57 points difference...
https://en.wikipedia.org/wiki/List_of_c ... ublic_debt

[Neu Leonstein]

This is propaganda.
France have a basic public system + various private retirement systems.
Macron isn't going to unify the private systems, nor it would make sense.
The only thing that can be unified is the public CARSAT (caisses d'assurance retraite et de santé au travail - retirement and occupational health funds), that is national but on regional level (there's also another thing in the Paris department, also public) - there can be some savings, but not so much.

Like I said, I'm not an expert on how the system works. I can only link you to his program, and given what I've read about it, I would be pretty surprised if it said that he wanted to raise the retirement age.

Probably it's even more, and that's normal.
France isn't USA: in USA a black is an American since many generations, someone who have been taught in the same schools of whites, and comes from the same American culture.
Immigrants in Europe shouldn't be compared to black Americans, it's a very different situation: immigrants come from very different cultures, have very different skills and education.

Do you think that someone who completed secondary education in Mali is comparable with someone who earnt a degree in France, when it comes at having marketable skills?

Did you click on the link? It's not just new migrants.

I know that Macron wants to reduce the security of more stable jobs to the level of unstable and unqualified jobs, I don't need his official reason for doing that, I know it yet.
I just don't think that such move will be beneficial.

Which is fair enough. Like I said earlier, this is at a basic level just an insider-outsider problem. The insiders (e.g. unions) don't want to give up any of their gains, even it that means that the outsiders (e.g. unemployed or migrants or children of migrants) will be left worse off. You can side with the former, I tend to side with the latter. But that's the question that should be asked in an election and answered by the populace. All this other theatre around it is just distraction.

Macron cannot implement the Danish model.
There isn't enough money for that: the Danish model is very expensive because it includes a lot of support, through money and even more in retraining.
France have a public debt that is 96.5% GDP
Denmark is at 39.6% GDP
It's a 57 points difference...
https://en.wikipedia.org/wiki/List_of_c ... ublic_debt

The Danish model is not about the total amount of money though. It's about spending it in targeted ways in order to make flexibility in terms of labour contracts work for all sides. In aggregate Denmark is pretty similar to France.

Country	General public services (% of exp.)	Defence (% of exp.)	Public Order & Safety (% of exp.)	Economic Affairs (% of exp.)	Environmental Protection (% of exp.)	Housing & Community Amenities (% of exp.)	Health (% of exp.)	Recreation, Culture & Religion (% of exp.)	Education (% of exp.)	Social Protection (% of exp.)	Total (% of GDP)
Denmark	13.5	2.0	1.8	6.7	0.8	0.4	15.6	3.2	12.8	43.0	54.8
France	11.0	3.1	2.9	10.0	1.8	1.9	14.3	2.3	9.6	43.1	57.0

Numbers are for 2015, source is Eurostat and there might be some small rounding errors.

But despite not spending that much more in aggregate, in Denmark the unemployment rate is 6.2% and the participation rate is somewhere around 62%. On other development indicators Denmark does very well and it is a lot less unequal economically than France. Isn't that worth investigating?

[Chessmistress]

Macron cannot implement the Danish model.
There isn't enough money for that: the Danish model is very expensive because it includes a lot of support, through money and even more in retraining.
France have a public debt that is 96.5% GDP
Denmark is at 39.6% GDP
It's a 57 points difference...
https://en.wikipedia.org/wiki/List_of_c ... ublic_debt

The Danish model is not about the total amount of money though. It's about spending it in targeted ways in order to make flexibility in terms of labour contracts work for all sides. In aggregate Denmark is pretty similar to France.

Country	General public services (% of exp.)	Defence (% of exp.)	Public Order & Safety (% of exp.)	Economic Affairs (% of exp.)	Environmental Protection (% of exp.)	Housing & Community Amenities (% of exp.)	Health (% of exp.)	Recreation, Culture & Religion (% of exp.)	Education (% of exp.)	Social Protection (% of exp.)	Total (% of GDP)
Denmark	13.5	2.0	1.8	6.7	0.8	0.4	15.6	3.2	12.8	43.0	54.8
France	11.0	3.1	2.9	10.0	1.8	1.9	14.3	2.3	9.6	43.1	57.0

Numbers are for 2015, source is Eurostat and there might be some small rounding errors.

But despite not spending that much more in aggregate, in Denmark the unemployment rate is 6.2% and the participation rate is somewhere around 62%. On other development indicators Denmark does very well and it is a lot less unequal economically than France. Isn't that worth investigating?

Do you really think that Macron is willingly to fill the 11% gap in social protection?
Macron has been elected to reduce the public debt...

[Neu Leonstein]

Do you really think that Macron is willingly to fill the 11% gap in social protection?
Macron has been elected to reduce the public debt...

I'm not sure I follow. What gap are you referring to?

As for the debt and deficit... I actually agree. Many in the markets do too - Macron shouldn't hesitate to spend more if it helps with implementing reforms. And I'm not saying this as an appeal to any sort of authority, but just to make the point that budget deficits aren't necessarily a matter of left vs right or socialist vs liberal. But this is where the European politics start factoring in. In order to get any progress on more centralised European fiscal authority going, he also needs to demonstrate that this won't just be a way for governments to spend more without having to pay for it. It's dumb, but while Schäuble is around it's really the only thing he can do.

But as I said, I don't think that sticking to the Maastricht criteria actually requires cuts to unemployment benefits or anything like that. The budget deficit is already more or less there and the forecasts from the ECB, EC and so on suggest that growth will actually pick up from here, and that'll help on both the revenue and expenditure side.