Eric Heyer is deputy director of the French Observatory of Economic Sciences and a specialist in French economy. Considers that France, with its social safety net, managed to cushion the brutal impact of the crisis. But he argues that the economic and fiscal rigor imposed by Brussels can slow recovery.
Question: How is the economic situation in France? Answer: It is terrible. We left a huge financial crisis that has affected all European countries and has greatly influenced the strike, which has reached 9.3%, a level not seen for 10 years. Is lower than in Spain, but is worse in part because there has been an explosion of long-term unemployed.
What has allowed more resilient in 2009 and 2010 has been its social model. It is particularly generous. He has played a mattress, unemployment has leveled off, backs off in tenths. But the problem is always the same people who become unemployed, and every time are less likely to find work.
For two years you are entitled to compensation of 60% of your salary. Then, a weaker support of around 800 euros, depending on the economic and social. However, we did a study and two years 43 of 100 unemployed would be below the poverty line. This indicates that automatic stabilizers are close to cracking.
This also explains the good results of the strike have catch: there are many long-term unemployed who no longer declared, discouraged. These or point. Not listed. They think, "Why get closer to the unemployment office." Q: In Spain there is a problem with youth unemployment. "In France? A: Yes and no.
Whenever there is an economic and employment crisis, the first casualties are young people. If today you are young in France, without qualification and wife, you go to the end of the queue. Youth unemployment has risen. Although it is always said that is 20 to 25%, but it is not. In France there are not many young people between 20 and 24 in the labor market.
At that age, two out of three are in school. So really, is 20% of a third. That is, 8% of the total of French youth. We are in the European average. Germany does it better, but others have more. Q: Is it worse the problem with 50? A: When you're 50 and you're unemployed, it's over. The probability of finding work is scarce.
A young man does have time to wait two years to recover the market, but someone like me ... Having to compete with people who have the same degree but is much younger than my return will make it harder to work. Of course, now we must have 42 years of service to receive full retirement. Crawl those two years of stop and stay a lifetime marked by the stigma of the crisis.
There will be a lost generation, but will be disadvantaged. Q: Some say that the problem of the French economy is debt, reaching 80%. Do you agree? A: No. I'm not saying that is not a problem. But not THE problem. After the crisis, unemployment and public finances were unbalanced. The recovery plan was an increase in spending.
So we face two problems: unemployment and restore the public finances. In Europe, via Brussels, the priority has been the deficit. But debt has grown 15% in two years. Is enormous. Reach 80% of GDP, is this serious? You have to see what is the liability of the government. Let's imagine you get into debt because they buy a castle for two million euros.
The bank lends the money. I do not know what you charge as a journalist for El Pais, but anyone can say, "Man, you are too indebted." But that is relative, because the day you buy the Castle is neither richer nor poorer than before. It all depends on the following days, whether the castle is worth more and more or fewer of the two million euros.
Thus, in addition to debt, assets must have: Remember, you need two million euros, but also has a castle. In France the government has many financial assets like stocks or semi-public companies as Areva, EDF. That is, the French state provides 45% of GDP, and real estate assets that are difficult to value, but we can estimate that roughly account for 60%.
So we have more assets than liabilities. We are not bankrupt. You can sell the assets. The United States does not have financial assets:'s been privatized. So, you can not only measure the wealth or the level of gross debt leverage. In addition, the rate of interest on the debt has fallen in 2009 and 2020 and that means there has been investor confidence.
I'm not saying do not have to consider the debt. Just say no one can be catastrophic. Q: Where is France? A: We are in a bad time. Now should not remove the interventionist policies. Climb, but not much. For me, the strategy now being carried all over Europe will not grow enough. Is the problem of making a rigid policy.
Q: Why protest in France? A: Let's see: in France, the private sector, there are no more strikes in the rest of Europe. The fifferences is organized in the public sector. The officials generally earn less, on an equal rating and put that in private, however, have certain privileges (favorable retirement or unemployment protection in case ...).
This reform changed the rules mid-game. There was no consultation or dialogue, and that can not happen in France. Here is to explain why things are done. In addition, unions representing 8% of workers. Thus, the government tends to disregard the protest. Is not it a way for people to hold on to their rights? As unionization is low, do not feel represented and out into the street.
Q: But unions protest personified. A: Yes, but where the unionization rate is higher, the government tends to argue and if not, do not listen. They do not represent. But if unions representing 80%, the government listens. Q: What will happen to France from the economic point of view? A: Well, it was decided to reduce the public finances.
As in all countries, including the most virtuous and less touched, Germany. We have closed the tap of public investment and if the state does not invest and private actors are not considered in a position to invest, where does growth? My diagnosis is that there will be no growth in Europe.
In France, the growth forecast is around 1.5% until 2013. So we can not lower unemployment.
Question: How is the economic situation in France? Answer: It is terrible. We left a huge financial crisis that has affected all European countries and has greatly influenced the strike, which has reached 9.3%, a level not seen for 10 years. Is lower than in Spain, but is worse in part because there has been an explosion of long-term unemployed.
What has allowed more resilient in 2009 and 2010 has been its social model. It is particularly generous. He has played a mattress, unemployment has leveled off, backs off in tenths. But the problem is always the same people who become unemployed, and every time are less likely to find work.
For two years you are entitled to compensation of 60% of your salary. Then, a weaker support of around 800 euros, depending on the economic and social. However, we did a study and two years 43 of 100 unemployed would be below the poverty line. This indicates that automatic stabilizers are close to cracking.
This also explains the good results of the strike have catch: there are many long-term unemployed who no longer declared, discouraged. These or point. Not listed. They think, "Why get closer to the unemployment office." Q: In Spain there is a problem with youth unemployment. "In France? A: Yes and no.
Whenever there is an economic and employment crisis, the first casualties are young people. If today you are young in France, without qualification and wife, you go to the end of the queue. Youth unemployment has risen. Although it is always said that is 20 to 25%, but it is not. In France there are not many young people between 20 and 24 in the labor market.
At that age, two out of three are in school. So really, is 20% of a third. That is, 8% of the total of French youth. We are in the European average. Germany does it better, but others have more. Q: Is it worse the problem with 50? A: When you're 50 and you're unemployed, it's over. The probability of finding work is scarce.
A young man does have time to wait two years to recover the market, but someone like me ... Having to compete with people who have the same degree but is much younger than my return will make it harder to work. Of course, now we must have 42 years of service to receive full retirement. Crawl those two years of stop and stay a lifetime marked by the stigma of the crisis.
There will be a lost generation, but will be disadvantaged. Q: Some say that the problem of the French economy is debt, reaching 80%. Do you agree? A: No. I'm not saying that is not a problem. But not THE problem. After the crisis, unemployment and public finances were unbalanced. The recovery plan was an increase in spending.
So we face two problems: unemployment and restore the public finances. In Europe, via Brussels, the priority has been the deficit. But debt has grown 15% in two years. Is enormous. Reach 80% of GDP, is this serious? You have to see what is the liability of the government. Let's imagine you get into debt because they buy a castle for two million euros.
The bank lends the money. I do not know what you charge as a journalist for El Pais, but anyone can say, "Man, you are too indebted." But that is relative, because the day you buy the Castle is neither richer nor poorer than before. It all depends on the following days, whether the castle is worth more and more or fewer of the two million euros.
Thus, in addition to debt, assets must have: Remember, you need two million euros, but also has a castle. In France the government has many financial assets like stocks or semi-public companies as Areva, EDF. That is, the French state provides 45% of GDP, and real estate assets that are difficult to value, but we can estimate that roughly account for 60%.
So we have more assets than liabilities. We are not bankrupt. You can sell the assets. The United States does not have financial assets:'s been privatized. So, you can not only measure the wealth or the level of gross debt leverage. In addition, the rate of interest on the debt has fallen in 2009 and 2020 and that means there has been investor confidence.
I'm not saying do not have to consider the debt. Just say no one can be catastrophic. Q: Where is France? A: We are in a bad time. Now should not remove the interventionist policies. Climb, but not much. For me, the strategy now being carried all over Europe will not grow enough. Is the problem of making a rigid policy.
Q: Why protest in France? A: Let's see: in France, the private sector, there are no more strikes in the rest of Europe. The fifferences is organized in the public sector. The officials generally earn less, on an equal rating and put that in private, however, have certain privileges (favorable retirement or unemployment protection in case ...).
This reform changed the rules mid-game. There was no consultation or dialogue, and that can not happen in France. Here is to explain why things are done. In addition, unions representing 8% of workers. Thus, the government tends to disregard the protest. Is not it a way for people to hold on to their rights? As unionization is low, do not feel represented and out into the street.
Q: But unions protest personified. A: Yes, but where the unionization rate is higher, the government tends to argue and if not, do not listen. They do not represent. But if unions representing 80%, the government listens. Q: What will happen to France from the economic point of view? A: Well, it was decided to reduce the public finances.
As in all countries, including the most virtuous and less touched, Germany. We have closed the tap of public investment and if the state does not invest and private actors are not considered in a position to invest, where does growth? My diagnosis is that there will be no growth in Europe.
In France, the growth forecast is around 1.5% until 2013. So we can not lower unemployment.
No comments:
Post a Comment