Vacationing in France, David Frum has penned a pair of interesting and amusing columns. The first is about being a tourist in Paris, where history is abundant but not always well tended. The second makes an important point about political attempts to eliminate “inhumane” liberty from labor markets. Some background:
The minimum wage in France is €8.50. Another €4.25 in payroll tax is applied on top of that wage, for a total minimum cost of hiring of €12.75, or more than [$17.50 an hour].
The law forbids employees to work more than 35 hours per week. Period. No overtime; it’s just flatly forbidden. French law guarantees generous mandatory holidays of up to six weeks. Firing employees is extraordinarily difficult, so you have to assume that anyone you hire will stay hired until he or she tires of the job.
An anecdotal example of the effect of this dirigiste paternalism:
It’s 2:15 on a French afternoon, and I am as usual at this time of day sitting in a café waiting to pay the bill for lunch. And waiting. And waiting. When you hear talk of the slowness of French meals, you may imagine haughty waiters languidly presenting an elegant repast. I am sure that happens too. But as it happens, I am not anywhere elegant. I am sitting in a very unremarkable seafood restaurant by the harbour in Dieppe.
There is nothing languid about the scene here. The patronne is racing about like a demon, taking orders, slapping down plates of fish, planting bottles of wine on the table with a thump.
She has to move fast. There are almost 30 tables in this place, and she has only one assistant. The two of them do everything that must be done in the front room. They clear tables, they bus dishes and, if you look at the mirror at the right angle, you can see them scraping plates and placing them in a dishwashing machine. At the moment when I decide I want a cheque, the assistant is at the back polishing newly washed glasses.
At $17.50 an hour, would you hire a second servitor? Actually, the “assistant” may well be a daughter or sister or daughter-in-law, helping out under a half-illegal arrangement so that the owner can afford to stay in business.
For the larger picture, some facts and figures:
Per hour worked, the French rank among the most productive people on Earth: 7% more productive than Americans, for example. But the devil lies in the phrase “per hour worked.”
Almost 10% of France's work force lacks jobs. France’s economy is not in recession; in fact, it is thriving. High unemployment has become normal here; not since the 1980s has France seen an unemployment rate south of 8%.
And remember, the unemployment concept counts only those persons who seek work. Those who retire early, or who qualify as disabled, or remain in school until age 30 do not count as “unemployed” in the job statistics. Only in life. The truest picture of French society comes from counting those in [the work force]: Altogether, 51% of French adults work, as opposed to 62% of American adults.
And those French who do work do not work very much: While working Americans work an average of more than 1,800 hours per year, working French people put in slightly more than1,500. . . .
Can France afford to keep missing economic opportunities? The gross domestic product of the 60 million people of France now roughly equals that earned by the 35 million people of California (using purchasing power parity valuations for the dollar and the euro). Over time, little differences compound into big ones. The Democratic economist Robert Shapiro calculates that, if present trends persist, the average European will see his standard of living decline to about half that of the average American by 2025.
But perhaps other Democrats will save Europe’s face. Congress has already raised the minimum wage. Once it has secured American defeat in Iraq, it can turn its full attention to promoting economic stagnation.
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