Saturday, April 16, 2011

What is it about the word "capitalism" that you don't understand?

The Right, looking to shore up its "social" side, as it always does when a presidential election approaches, has called for stock dividends to be linked to bonuses to employees. The idea comes from François Baroin, chiraquien, who may be barely old enough to recall Chirac's winning mobilization of the theme of la fracture sociale to beat back the neo-liberal Balladur in 1995. But Laurence Parisot, the head of the employers' organization MEDEF, is having none of it:

"Nous avons rencontré le premier ministre, il y a une dizaine de jours. A aucun moment, il n'a été question de cette mesure si problématique", précise-t-elle."Attention, s'il n'y avait plus de distribution de dividendes, il n'y aurait plus d'investissement !", prévient-elle en soulignant au contraire la nécessité de soutenir celui-ci pour accélérer la sortie de crise.

In other words, "Get lost, Baroin! Profit is what makes the world go round." But she wasn't entirely without encouragement for the "social" Right. She was none too keen about Claude Guéant's proposal to limit legal immigration. You know how it is: the profits from which dividends are drawn depend just as much on workers willing to work for low wages as on making sure "investors" claim their rightful share of earnings without having to dip into their pockets to pay bonuses to workers, already so abundantly compensated by their wages. So she added this:

Par ailleurs, elle ne croit pas qu'il faille faire de l'immigration légale liée au travail "un problème". La France doit rester "un pays ouvert", assure la présidente du Medef. Face à la montée du populisme, "le plus grand danger, ce serait de se refermer", ajoute-t-elle, en se livrant à un vibrant plaidoyer en faveur d'une plus grande intégration européenne.
There was also praise for the unions, who had sagely limited their wage demands to the rate of inflation, avoiding redistributive issues in these difficult times for capitalists, who for the first time in years find themselves without the tax shield that Nicolas Sarkozy had promised to enlarge:

Elle dresse un bilan positif du dialogue social et du paritarisme. "Aujourd'hui, dit-elle, la CFDT, FO et la CFTC s'honorent en signant des accords qui préservent (…) le pouvoir d'achat des salariés". 
Unlike so many people, confused about where their interests lie, the MEDEF sees the future clearly: keep the profits rising and flowing exclusively to investors, the unions docile, and the influx of low-wage workers sufficient to guarantee that conditions one and two are satisfied, and all will be well. And yet Parisot excoriates "la montée du populisme" as if she had nothing to do with it.


FrédéricLN said...

Very strange idea from Baroin. The wages may already be higher in profit-making businesses that in others. And many ways already exist to share profits with employees (intéressement, participation, épargne salariale...), they are subsidized by the State (or encouraged by the tax system). This is the core dogma of "le gaullisme social".

Where is the problem? Whats's missing? Creation of jobs in France. Large globalized French companies that make large profits, invest them on "emerging markets" or in low-wages countries.

Either the government could order these large companies to create new jobs (???), or he could raise more taxes among profitable companies in order to save State-paid jobs, or in order to encourage job creations by SMEs, or to create a better "pro-jobs" environment at large.

But focusing the "pouvoir d'achat" issue on the staff of the most profitable companies, has something completely absurd in it, imho.

Vincent Forest said...

I totally agree with the link made between economic issues (distribution of wealth, mainly) and the rise in populism.

By closing a dogmatic door on economic solutions to economic problems, the MEDEF (among others) opens another door to populist solution-makers.

Thanks for this good analysis.