Labor reform in France’s Macron economy
Protestors against President Emmanuel Macron’s proposed liberalization of French labor laws were on the streets of the country’s cities on Tuesday. The marchers, chanting slogans and brandishing placards, halted traffic as they moved slowly through the streets. A fringe of anarchists broke windows; police responded by firing tear gas. But this was no rerun of the mass marches of past years, let alone the semi-revolutionary eruptions of 1968.
France’s second-largest union, the ConfÈderation GÈnÈrale du Travail (CGT) was the only one of the three main workers’ organizations that took part. Another protest, this one organized by the far-left France Insoumise (France Unbowed) party is scheduled for Sept. 23. The Tuesday marching columns numbered, nationwide, in the few hundred thousand rather than the many millions hoped for - the police claimed 223,000, the organizers 400,000. There was little effect on production, services or transportation.
It was neither victory nor defeat for either side. Instead, Macron’s changes to the vast labor code - hiring and firing will be easier, some workplace issues will be negotiated at company level - hang in the balance. The CGT, the left and the far-right National Front all oppose them, but Macron and his government have a solid, if inexperienced, majority in the Assembly.
More than his predecessors who tried and failed to liberalize France’s labor market - the center-right Nicolas Sarkozy and the center-left Francois Hollande - Macron has pinned the credibility of his presidency on systemic, cultural change, a deliberate jolting of French society and economy out of the rut into which he believes it has fallen. He is contemptuous of both former presidents (he knew Hollande well, having been both his advisor and Finance Minister), believing them to have given up too soon and too easily. When Macron spoke, as he did earlier this month, of “slackers,” he said when challenged that he meant those who retreated from the necessary surgery on France’s body politic. The marchers, however, seized on the word and put it on their placards: “Macron, the slackers will kick you out,” read one.
The slackers have a point. Indeed, they have several. Labor productivity in France is relatively good, only a little behind that of the United States and the highest of Europe’s major economies. When French workers work, they work well.
Though both Macron’s labor and economic reforms have won support from the center-right and from many economists, France remains doubtful, even hostile. Perhaps the best-known Frenchman in political and intellectual circles before Macron was the economist Thomas Piketty, whose “Capital in the 21st Century” (2013) is a best seller and who has excoriated his country both for its steeply rising inequality and its hypocrisy in pretending it is egalitarian. Hypocritical it may be, but it clings to the myth, and perfectly bourgeois Frenchmen and -women may recoil from an obvious widening of the income and wealth gaps.
To put major emphasis on labor reforms may, in any case, not be the main point. Germany liberalized its labor market through the so-called Hartz reforms between 2003 and 2005, but unlike France the German unions were relatively moderate, wage bargaining was already localized and investment was rising. In addition, the costs of German unification had already been paid. — Reuters