STUMP » Articles » French Pension Protests: State of Play, 22 Jan 2020 » 22 January 2020, 21:00

Where Stu & MP spout off about everything.

French Pension Protests: State of Play, 22 Jan 2020  


22 January 2020, 21:00

In my two previous posts on the French Pension Protests, I dealt with the state of play with respect to the pension changes themselves.

For now, until it is resolved, I will amass stories on continuing strikes and protests.

But first!


Via Virginia Postrel, The price of France’s bizarre union landscape

PARIS — Charles de Gaulle famously complained that it was impossible to govern a country with 246 different kinds of cheese.

His successor Emmanuel Macron might frame the question another way: How can you reform a country that has eight trade union federations?

Britain is content with just one federation of unions. So is the United States. Spain makes do with two. Germany, Belgium and Italy have three each.

We have a federation of unions? I guess it’s AFL-CIO, but there are unions that aren’t part of it. In any case, even if the AFL-CIO called a general strike, it would be a small percentage of the population on strike (and not all government unionized employees can legally strike.)

But evidently, the country of liberty, equality, and fraternity have trouble with unity.

France, meanwhile, has eight — more than any other Western industrial country. They range from the hard-left to the Christian democratic, by way of the moderate, the managerial and the bloody-minded.

The rivalry between these competing trade union confederations helps to explain the longevity of the strikes against Macron’s proposed pension reform, which are now stretching into their second month.

The strikes are weakening daily but also mutating into a kind of guerrilla warfare of micro-demonstrations, including the invasion last Friday of the headquarters of a large, moderate union, the CFDT, by angry members of two militant ones.
French syndicats are not single industry “unions” in the British or American sense. The biggest ones are umbrella unions that have semi-independent branches in every industry, from teaching to ship-building, railways and nursing. Others are concentrated in narrower sections of the workforce, such as executives or public employees.

And while the same umbrella pattern is found elsewhere, no other EU country has so many union federations with differing political flavors as France.

Why so many? To answer that question you have to address another question: Why are there so few French union members?

France has a smaller unionized workforce than any other EU country — less than 8 percent of the workforce, only 5 percent in the private sector. French unions are best understood as political parties of the workplace. They have relatively few members but many supporters or voters who broadly follow their line. Workplace elections every five years decide which unions are represented in national and local negotiations.

So my assumption would be that the unions are opt-in, not opt-out, which would explain why membership is so low (as in the U.S., where unionization rates generally differ by whether you’re forced to be a member.)

One thing I noticed in the article is this:

This battle-within-the-battle may prove to be more significant than Macron’s pensions reform itself (which does not fully take effect for 17 years). A victory for the moderate unions, led by the CFDT, could prove to be an important turning point in France’s bizarre trade union history.

As the strikes threaten to stretch into their third month, French Prime Minister Edouard Philippe offered a concession last week to the reformists’ main complaint — shelving a proposal to raise the de facto full-pension age to 64, 10 years before the bulk of the reform takes effect in 2037.

Now, that’s just two throwaway lines, but the implication is “why are they getting so het up about something that’s not going to go into effect for 17 years?”

Clearly, the only reason the unions are getting worked up is because of petty politics between the groups.

Mmmm. Yeah.

That could be. Or, they really could be annoyed by the changes to their system, because they know they’re going to lose out.

But I’m not assuming one way or another. Maybe the protests will continue. Maybe they won’t.


So here are the pieces I’ve come across since my last post on France.

As one protest ends, another begins, it seems.


Finally, Why Macron Refuses to Retire in France’s Pensions Battle:

This was not the first time that a French government had tried to reform the pensions system. In 1995, under President Chirac, Prime Minister Alain Juppé proposed a major overhaul of health coverage and pensions, with the aim of reducing the chronic deficit in state spending. After three weeks of strikes and demonstrations, Juppé had to bin his plan. Later, presidents of both right and left (Sarkozy in 2010 and Hollande in 2013) also tried to introduce pension reforms. But after getting their fingers burned, too, those measures were much more modest. From day one, undaunted by these unpromising precedents, Emmanuel Macron pledged to succeed where they had failed.

The French president insists that he intends only to substitute a “fairer and clearer” pension management system for an outdated one that has become increasingly complex over the past seventy years, with countless exemptions from the norm. The monthly pension of civil servants, for example, is based on the average of their six final salaries, whereas that of private-sector employees is calculated on the average of their twenty-five highest-paid years. By now, there are forty-two “special” retirement plans, all more advantageous than “normal” pensions.

Why is he doing this? Because, whatever he says, he is a fiscal conservative: his way of thinking is primarily governed by his determination to balance the books.

Since French pension funds were already in financial difficulty, the real reason for reform is not so much to manage pensions more efficiently, but to reduce their cost. And the government’s strategy for getting the reform through has been to try to divide the workers, telling private-sector employees that safeguarding their pensions requires the abolition of public-sector workers’ special privileges.

Not surprisingly, people see through the device—and this explains why the pensions issue has brought huge numbers of protesters out on the streets, including young people who are usually difficult to mobilize around an issue that seems abstract and far in the future. Nurses and students especially see the dispute as part of a general erosion of terms and conditions and pay. And many of them see the only winners as being those with the means to preserve their pensions through private insurance schemes.

President Macron’s perceived arrogance and lack of experience has only added to public suspicion of a hidden agenda. After a week of strikes last month, he sent out his prime minister, Édouard Philippe, to explain in a series of interviews the details of the reform. The result was a fiasco.

Philippe’s only significant concession was to say that the universal system, which was to come, step by step, into full effect by 2025, would now be delayed until 2037. The gambit was about as subtle as a brick: for anyone aged forty-four or older, don’t worry—only your kids will be affected. No wonder the strikers harbor a deep-seated conviction that the government’s real aim is to dismantle the welfare state.

As they were for Margaret Thatcher thirty-five years ago, the stakes for Emmanuel Macron today are hugely high—far beyond simply the need to fix the pension-fund deficit. Macron believes that this battle is fundamental—and the unions agree. When he was elected, Macron’s favorite expression was “and at the same time”: I deliver a blow to the left, “and at the same time,” a blow to the right. Those days appear to be over, precisely because the old social-democratic settlement is failing. Macron means to propel France into the era of financial capitalism, and he is no longer trying to maintain a centrist position but to rally the right to his standard.

Macron’s overhaul of pensions is a response to what the French conservative right has wanted to accomplish for two decades, without success. The French right is also weaker politically than it once was, but far less so than the center-left. Hence Macron’s strategy. De Gaulle used to say, “Between me and the Communists, nothing,” by which he meant: as long as he made sure that his only opponent was the Communist Party, he would always keep power. Macron believes that social democracy is no longer a threat to his rule. So, if he succeeds in siphoning off to his cause a vast majority of the old conservative and center-right voters, the Gaullists and the Sarkozy-ites, then there will be nothing between him and Marine Le Pen. If populist far right is his only opponent, he will always win. It’s a risky game.

I put it at: he wants to win where all those prior “great men of France” lost.

It’s not clear to me that he can do it.

Related Posts
Requesting a Public Hearing on Public Pension Actuarial Practice
Taxing Tuesday: Meep is Done with 2018 Taxes
New York State Climate Investing Goals: Who's On the Hook?