Monday, October 20, 2008

Retirement Reform

The Bozio/Piketty plan for retirement reform, which I discussed here briefly some months ago, has now been published in revised form, as discussed here. An on-line version is available here. I hope to be able to report on the plan before too long. In the meantime, if any of you have a chance to read it before I do and want to comment, I'd like to hear your thoughts.

Five Billion to Towns and Cities?

Five billion euros have been promised to towns and cities to cover speculative losses, as nearly as I can make out from this rather ambiguous article. These funds appear to be not loan guarantees but exceptional credits to enable the recipient towns to meet expenses. If so, the prospect of future tax reductions, once the centerpiece of Sarkozy's economic policy, would seem to be dimming. It would be nice to have more details about how these losses were incurred.

Paying for Higher Ed

The Institut Montaigne has published a report by Nicolas Colin, who argues that higher education in France should not be free. He tries to make the case that higher ed paid for out of public funds primarily benefits the middle and upper classes, yet most of the return on the investment in education is privately appropriated by the beneficiaries. I think that the conclusions Colin draws are wrong, but his arguments are worth pondering and suggest the need for reforms in the allocation of educational resources. But this is too large a topic to tackle in a blog post.

Bretton Woods bis?

And yes, while speaking of Sarkozy's recent revitalization (see previous post), I mustn't omit this weekend's get-together at Camp David, where Sarko, Barroso, and George W. Bush shared a dinner of roast lame duck and black-eye peas. "Sarko wrests a summit from a reluctant Bush," the headline writers want to scream. The Europeans, they say, want a "Bretton Woods bis." The only problem with this formulation is that the situation is quite different from what it was in 1944, when the United States was on the verge of emerging victorious and rich from a war that left much of the rest of the developed world prostrate and poor. Many years had passed since the collapse of the global economy in the 1930s. Bretton Woods was thus an opportunity to take stock, to consider the failures of the past with suitable perspective and in a world ripe for a new order.

The current crisis is still unfolding. Its causes are not fully understood. Agreement on remedies is unlikely in the short term. And what is needed now are emergency measures, not overambitious makeovers. Sarkozy's activist instincts served him well in putting together a European bank rescue plan, but his summit proposal thus far seems long on showmanship and short on substance. Even Bush seems to recognize this, and I rarely give Bush credit for anything. Hence his footdragging. In any case, it would be absurd, not to say impossible, to make any commitments until a new administration is in place in the U.S.

Digital France

Remember the good old days when Sarko was making two, three, four announcements a day of new programs, tearing up the tax code, taking on the unions, comforting the assaulted and bereaved, and liberating hostages from the infidel? It was a whirlwind of activity, a blogger's dream. Then he remarried, got sober, was sandbagged by crises from Tbilissi to Wall Street, and sought solace in the calm of the Elysée. We didn't see as much of him.

But today he is back with a plan for "digital France." Compared with liberating the slumbering worker to work more in order to earn more, this initiative, the fruit of Eric Besson's elucubrations, seems a trifle underwhelming to warrant the full presidential Monty, but dog-and-pony opportunities have been in short supply, so on fait feu de tout bois. Digital television is coming to France. Broadcast frequencies will be liberated and can therefore be auctioned off to mobile Internet service providers--a one-time windfall to a state badly in need of same. There will be more high-speed Internet access as well. Who can complain about that?

No doubt the adepts of the ubiquitous "precautionary principle" will find grounds for bringing out their worry beads yet again. New antennas will spring up in neighborhoods not yet bristling with cell-phone towers. People whose noggins functioned well enough with television signals coursing through their brains will feel headaches coming on at the thought of their neighbors' e-mail doing the same. Scientific research will be brandished by six angry characters in search of an authority. Sociologists will write about new social movements. Orange and SFR will replenish their coffers. Monsieur Bouygues will find ways to favor the president with his largesse. Crisis or no crisis, life goes on.