Thursday, June 13, 2013

Social Explosion Ahead?

Retirement reform has been--if I may use an American metaphor--"the third rail" of French political life since at least 1995. Many people who voted for the Socialist candidate in 2012 were probably under the illusion that he would roll back the legal retirement age to 60, although Hollande--or at any rate his advisors speaking on his behalf--never committed himself to any such thing. Nevertheless, the news that the required period of contributions for a full pension will probably be increased from the present 41.5 years to 43 or 44 and the legal age of retirement from 62 to 63 is already sending ripples through the Socialist Party and may well set off a conflagration when finally announced. Nothing has been done to prepare the restive electorate for this shock--unless of course you count the 20 years of public debate about the sustainability of the pension system. The trouble is that this reform is going to be proposed by the Left. When Sarkozy moved some distance in the same direction, the strikers could always tell themselves that the next time would be different. But now that the next time is turning out to be more of the same, frustration will very likely turn to rage. This could be the summer of France's discontent, and Hollande's recent improvement in approval polls will not likely survive, although he hasn't much room to fall on the downside.


Passerby said...

Time for a reality check has come.

When retirement age at 60 was introduced by Mitterrand, sustainability was already questioned. Deficits grew over time, yet voters assumed that the system could keep on going indefinitely.

Worse,during the Sarkozy/Fillon reform, when the cost of public pensions was debated, certain unions like the CGT proposed to extend these conditions to the private sector (while maintaining the limit at 60, of course).

I see how in economy there can be ideological disagreement over efficiency of demand-side vs supply-side policies. But pension financing should be a straight forward discussion. If the system is running out of cash, you increase contributions, decrease benefits, or go bankrupt.

The anti-reform partisans are basically in a "jusqu'ici tout va bien" stance, hoping to keep the system running just long enough to get a free-ride retirement themselves. This is plain recklessness.

Anonymous said...

If more young people worked, there would not be such a need for pushing the retirement age. Right now the median age in France for finding a "real" job is 27. If only 4 years could be shaved off that average the situation would be much different. I dislike the government's unimaginative way of looking at things.
This idea that I found on mediapart sounds at least more effective and interesting.

Anonymous said...

More young people were getting into work along indeed with many others, a total of 900,000 until Hollande caved into vested interests and killed off the auto-entrepreneur scheme. Sheer short sighted perversity.

Jonathan said...

Je devrais prendre des leçons de toi