Note: I spent nine days in Great Britain visiting my daughter. These are some observations about the events that unfolded while I was there.
Paralysis in France and Italy
In Western Europe, you see paralysis. The recent Italian elections went in the direction of the leftist Romano Prodi and away from the ruling center-right coalition of Silvio Berlusconi by the narrowest of margins. The election showed Italy evenly divided as a people and not yet committed to the needed reforms to move their economy forward.
In France, mob rule dominated the day as angry young workers, including many unemployed, protested the moderate reforms geared to increase their job prospects. Call it the protest of the unemployed to stay unemployed.
The problem for both France and Italy is that their economies, along with that of Germany, are limping along with high unemployment nearly double of that found in either Great Britain or the United States. Italy’s economic growth has been half of the rest of Europe for nearly a decade, regardless of whether a right-of-center government or a left-of-center government ruled. With taxes high and government over regulation stifling businesses, Italy is an economic basket case.
The dilemma for the French is that the labor market is too rigid and the government too highly involved in the economy. It is virtually impossible to fire someone. When the present French government decided to make it easier for businesses to fire workers under age 26, the goal was to make it more economically viable for French businesses to hire inexperienced workers. With overall unemployment hovering around 10 percent, the unemployment for younger French workers under 25 is nearly 2 1/2 times higher than the general population.
With a fast growing Muslim population becoming more alienated from the greater society and with even fewer job prospects than native born French workers, France is sitting on a powder keg that could explode at any instant. With an inflexible labor force, France is moving backwards in its economic race with the Anglosphere and, in the process, hurting the entire European Union’s ability to compete with the rest of the world. Europe is slowly being remade in the image of France, a France that is no longer capable of leading and that is sinking slowly into the abyss.
Article comments
1 - Lumpy
Great thoughts at the end about the anglosphere. Reinforces the fact that England really isn't part of the mess that is europe anymore, which makes them very lucky.
BTW on French unemployment look at the number actually holding jobs insted of officially unemployed and u come up with overall unemployment near 3O percent. Scary.
2 - RJ Elliott
"The problems for both France and Italy is that their economy, along with West Germany's"
West Germany's???
3 - RJ Elliott
"a Republican Congress actually passed a capital gains tax on his watch"
capital gains tax CUT, it should read...
Are there still editors at BlogCritics?
4 - tom donelson
You are right, it is tax cut in Clinton administration.
As for West Germany, well, I lapsed into a Cold war moment. It is Germany.
5 - Bliffle
By contrast, I just returned from two weeks of eating and hiking in the south of France, and I see a different picture. What I saw was prosperity and growth. New cars everywhere. Young people finding work to do (even my ne-er do well son-in-law has a job as a waiter and a flat that has appreciated 100k since he bought it with his mothers help 5 years ago). The local farmer who is buying up every scrap of land available is smiling and happy. I watched him feed 300 cattle in a huge barn simply by operating a couple simple devices, and rotate cows between the barn and pastures with only the help of 3 brilliant canines (of a type I've never seen before, calm, large, quiet, and ultra good even with 5 year old children). Not many years ago 6 people would be required. The fields are bright green with grass, overlaid with the yellow of arrowroot and buttercups, cows content to browse in the luxury, and bulls too sated to bother to chase the occasional hiker from their domain. Life is good in the land of cows, goats and lambs. I forsook my vegetarian vows for a few days for some tasty veal, sausage and duck.
The Brits are rich and they are prominent in the south of France where they luxurate in the good weather, enjoy the excellent food, restaurants, wines and villages. For the most part, they are appreciated by the French. Ryan Air has daily low cost flights.
What about the riots in Paris? "Only the newspapers can find them", report my friends from Paris.
6 - Arch Conservative
What is the purpose of that post Bliffle? [Edited]
You took a hiking trip on LSD in the South of France so everything in Europe is Honkey dory?
7 - Ruvy in Jerusalem
What was the purpose of your comment, AC - to prove how nasty you can be?
Are you in Europe NOW, that you can dispute Bliffle's word?
What you see in a capital, and what you see in a tourist center are two different things.
8 - Ruvy in Jerusalem
Bliffle,
Note what you SAW with your own eyes, as opposed to what Mr Donelson saw.
The next time you read a piece out of Jerusalem remember how different your view was from that of Tom Donelson's.
9 - Arcg Conservative
Ruvy....so you don't think Bliffle was on acid when he took that hiking trip and/or wrote that post?
10 - Dave Nalle
Bliffle, having recently been to the south of France myself I can tell you definitively that the situation in southern France with its wealthy international population, strong agricultural base and massive tourist industry is radically different from the way things are in France's central urban corridor and the area around Paris. I have a friend who lives in southern France 4 months out of the year. While he's there he works in the underground economy, trades on the black/gray market and has a great time. But he and the French natives who live in that area won't even travel to Paris or the areas around it, and are derisive of that part of France and the government as if it were an entirely different country.
The Brits are rich and they are prominent in the south of France where they luxurate in the good weather, enjoy the excellent food, restaurants, wines and villages. For the most part, they are appreciated by the French. Ryan Air has daily low cost flights.
Exactly. That part of France is almost like a British colony.
What about the riots in Paris? "Only the newspapers can find them", report my friends from Paris.
Odd, my friend and his friends report that they want the government to change the laws so that the problems of Paris don't spread to their part of the country. And I'm pretty sure all the photos I've seen of rioting aren't faked. I sincerely doubt your friends from Paris are as totally oblivious as you make out.
Dave
11 - Ruvy in Jerusalem
No AC,
Bliffle visited a rich part of France, a point that Dave Nalle makes clear in his post above mine.
12 - Bliffle
Dave is the only one close to the truth. The rest of you are scandalously wrong: I've never touched LSD or anything like it (AC proves himself an utter idiot with such florid statements), I was in the un-tourist part of the south whose cities and towns are completely unknown to most Americans, the people there are not rich they are INDUSTRIOUS (a much more valuable quality).
As Dave points out, the countryside is antagonistic to the sins of Paris. There is no egregious show of wealth. People are quite modest. No McMansions: people of means renovate old stone houses, they don't build new 'presentation' houses.
13 - Joey
And Eastern Europe?
Growing. GNP at a positive 9% per annum.
Why?
Hayekian model of economics. No government controls let free markets be free market economies.
It's that simple. Proponents of Hayekian models have been saying this for years. In fact the Keynsian model failed in 1972 when we had a recession and inflation simultaniously.
Keynes might have worked, if populations and markets remained static, but they don't and they didn't.
Read... The Road to Serfdom, it's an eye opener.
14 - Bliffle
joey: "Hayekian model of economics...."
Gosh, I didn't know Selma was that influential in Eastern Europe. She's had a profound effect on me, but...well, let's not go into that.
15 - Arch Conservative
OK Bliffle my point was that contrary to all your pretty pontificating about your trip to France the national French economy is in the toilet.
You deny this?
16 - Dave Nalle
AC, I think that Bliffle and I are both saying that France maybe shouldn't be treated as a single country when looking at economic success or failure, because while the average might look bad, there are parts of the country which are doing quite well, balanced out by the other parts which are complete, fucking disasters.
Dave
17 - Arch Conservative
Dave... I don't pretend to be an expert on French politics or economics but one would think that both the areas you mentioned would be subject to the same national policies, rules and regulations. While it may be useful to discuss regional economic differences on the domestic level I do not think it is national economies on the global scale. Overall the French economy is stagnant and experiencing a much higher level of unemployment than most other western nations.
Bliffle's post just irked the shit out of me as it depicted France as some type of economic and social utopia and Bliffle is the kind of guy who'd probably trash the American economy or call it unfair like the socialist goons who frequently post on BC.
American unemployment is below 5%, while the French unemployment rate is approaching 30%. German and Italian rates are double ours. Gotta love that "sophisticated, refined, socilaist" european lifestyle huh?
18 - Joey
Bliff #14 -- No relation to Selma
F. A. Hayek (1899-1992), recipient of the Medal of Freedom in 1991 and co-winner of the Nobel Memorial Prize in Economics in 1974, was a pioneer in monetary theory and the principal proponent of libertarianism in the twentieth century.
On the first American edition of The Road to Serfdom:
"One of the most important books of our generation. . . . It restates for our time the issue between liberty and authority with the power and rigor of reasoning with which John Stuart Mill stated the issue for his own generation in his great essay On Liberty. . . . It is an arresting call to all well-intentioned planners and socialists, to all those who are sincere democrats and liberals at heart to stop, look and listen."--Henry Hazlitt, New York Times Book Review, September 1944
"In the negative part of Professor Hayek's thesis there is a great deal of truth. It cannot be said too often--at any rate, it is not being said nearly often enough--that collectivism is not inherently democratic, but, on the contrary, gives to a tyrannical minority such powers as the Spanish Inquisitors never dreamt of."--George Orwell, Collected Essays
Hardly any other book accomplishes so much in so few pages. The Road to Serfdom aimed at explaining the rise of totalitarianism in early twentieth century Europe. Yet it also made a more general argument concerning the limits of democracy and human reason. In particular, Hayek argues that the rise of totalitarianism in Europe was an unintended consequence of the pursuit of socialist ideals. While these ideals seem noble to many, those who persist in realizing these ideals will find it necessary to adopt coercive methods that are incompatible with freedom. Thus socialists who desire freedom must choose between realizing the socialist goals of planning production and redistribution income and the preservation of individual liberty.
To begin, Hayek describes how Europeans came to expect progress, and became impatient for faster progress. The liberal reforms following the enlightenment produced unprecedented progress in bettering the human condition. Much of this was directly due to scientific discovery, while the role of free competition in promoting scientific discovery was less obvious. Europeans increasingly came to believe that scientific planning of society itself could produce even greater progress.
Europeans also changed how they thought about equality and freedom. The desire for equality of results displaced the principle of equality before the law. Insistence upon freedom from want displaced the yearning for freedom from coercion. Democracy came to be seen as a means of realizing an increasing number of social goals, rather than as a means of preserving freedom. To Hayek, these were dangerous errors. Democracy could only work effectively in areas where agreement upon ultimate ends could be attained with little difficulty. A democratic government could enforce general rules of social conduct that aimed at no particular ends, and that applied to all equally- i.e. constitutional rules regading free speech and free association. As people came to expect government to aim at specific economic goals, democracy became untenable. The pursuit of specific economic goals through government planning meant that some end values would be pursued at the expense of others. People can never agree about policies that affect specific economic results. One always gains at the expense of others in such matters. Economic planning of specific outcomes places impossible demands upon democracy. This is because pursuit of specific ends requires timely and decisive action. Democracies move too slowly to attain specific ends, so discretionary powers of government will grow. The relentless pursuit of specific end values and economic outcomes through government planning will ultimately require acceptance of dictatorship. This is a dire consequence, as it is the worst sort of tyrants who are most adept at wielding dictatorial powers.
Some might say that these arguments are unduly pessimistic. Hayek points to the examples of Hitler and Stalin to support his case. Hayek asked how freedom of the press can be safeguarded when the state controls all the supply of paper and channels of media distribution. As if to prove Hayek right state officials in the Soviet bloc banned the printing of his book. Of course, these are worst case scenarios. Have not England, Sweden, and the US adopted large welfare-regulatory states without such tyranny? This is a fair point, yet we should remember two things. First, Hayek claimed that centralized control of the economy would destroy freedom ultimately, but gradually. Second, Western nations have not yet gone as far in planning their economies as did Russia and Germany in the 1930's. The fact that we have yet realized the horrible results of Stalinism implies neither that were are safe from despotism in the future, nor that our present situation is entirely satisfactory. One could easily argue that we have already lost some individual freedom, and are in danger of losing more. One should read Hayek's chapter on `The End of Truth' while thinking about modern political correctness. The general nature of Hayek's arguments concerning the incompatibility of a large activist government and individual liberty make it as relevant today as it was in 1944. This is true not only for modern welfare state liberals and those few remaining socialists, but also for modern conservatives who seek to use big government to attain their ends.
Hayek wrote this book not only to warn people about the limits of democracy and the incompatibility of planning and freedom. This was the start of his project concerning the abuse of reason. His warning is also about the tendency to overestimate the abilities of even the best and brightest individuals. Even the best and brightest are not capable of planning out the details of a complex social order. No single person or small group of persons can comprehend either the specific ends of people throughout society or the means of attaining these ends. Socialists who desire to consciously plan society comprehensively, and even welfare state liberals and conservatives who want to plan only a fraction of society, proceed on a false assumption concerning the abilities of even the best and brightest. Ultimately, Hayek makes a strong case for limited constitutional government. To expect more of democracy than what Madison and Jefferson intended is to risk disaster.
The Road to Serfdom is a book of remarkable insight. It is a timeless classic on political economy, and a profound defense of individualistic principles. This book has its critics, mainly on the left. Yet this is due to its insightful nature. The Road to Serfdom has produced hysterical responses from the left since 1944 simply because it strikes at the core of both democratic-socialist and Marxist beliefs. Hayek demonstrates that socialism is by no means inevitable, and that it would ultimately produce results that most socialists find repugnant. If there is anything wrong with this book, it is that some of its arguments are subtle to the point of being hard to notice, and that there are a few compromises that Hayek made out of expediency. These are, however, minor shortcomings. The Road to Serfdom stands out as a true classic, as timeless as it is insightful.
19 - RJ Elliott
France is an economic basketcase.
There is very high unemployment (over 10%), a sizeable annual budget deficit, and high tax rates (even by European standards).
The French economy (GDP) is growing at a weak 1.6% rate/year.
It's national debt is about 2/3rds of GDP (which is higher than the USA's national debt).
And when some relatively mild economic reforms are proposed, the people riot for weeks.
Not a pretty picture...