Europe loses its cool

A pampered continent protests the rollback of its lavish welfare state

by Charlie Gillis and Nancy MacDonald on Wednesday, November 3, 2010 12:20pm - 0 Comments
Europe loses its cool

Charles Platiau/Reuters

Hugo Christy doesn’t have to worry about his pension for 40 years. He hasn’t even started working yet. None of this has stopped the 21-year-old student from the Institut d’Études Politiques de Paris from joining thousands of striking workers in mass protests against the French government’s pension reforms.

Rolling strikes and nationwide demonstrations against the move all but brought the country to its knees, as people from all walks of life decried the hike in the French age of retirement from 60 to 62, and the age for full state pension from 65 to 67. Last week, President Nicolas Sarkozy was forced to call in riot police, who used tear gas and batons to clear key fuel depots and get gas flowing to service stations—more than a quarter had run dry. Strikes shut Marseille’s docks, and left many of the southern port city’s sidewalks filled with rotting garbage. More than 300 high schools were blockaded, and streets from Paris to Nice were flooded with youth and workers carrying drums and bullhorns, chanting slogans, staging sit-ins, and singing the Internationale, the socialist anthem. Children as young as 10 demanded their government withdraw its reforms, suggesting either remarkable awareness, or some early instruction by their parents in the art of dissent.

“It’s a question of fairness, of social justice,” declares Christy, who studies urban planning and expects to enter the civil service when he graduates. Those who worked a tough job, like bus drivers and miners, he adds, should be allowed to retire even earlier than 60—anything less would be “unfair.” And he views benefits like five-week vacations, a 35-hour workweek and early retirement as a kind of birthright, much as Canadians might view universal public schooling. Despite numerous warnings that the country’s cushy pension scheme has become unsustainable, the majority of French citizens seem to share his view: polls suggest support for the protests tops 70 per cent, despite the fact the disruptions were costing the public treasury a half-billion euros per day.

To Denis Rivier, an electronic technician from the Loire Valley town of La Talaudière, even the slightest concession on those entitlements would be “catastrophic,” setting French workers on a path back to the Industrial Revolution. Working conditions at the factory where the 58-year-old repairs circuit boards have already “radically degraded,” he claims. Where once he worked on a flexible schedule—coming in between 7 and 9 a.m., and heading home anywhere from 4:30 to 7 p.m., so long as he put in seven hours—Rivier now has to work a set shift. “All the leeway I had to organize my work life disappeared,” he says, adding that his employer, in an apparent cost-cutting move, has removed lockers where workers once stored their lunches and pinned up family photos. “Misery,” he concludes, “is returning to the working class.”

To Canadian ears, such complaints sound absurd. Shift work during tough economic times? Better than no work at all. Retiring at 62? We wish. But Rivier’s outrage typifies a denial of economic reality among average Europeans that seems to be deepening as their governments hurtle toward the financial abyss. In the past four weeks, workers in no less than 12 European countries have staged crippling strikes or protests in response to austerity measures almost no one disputes are necessary to shore up their nations’ wobbly finances. France’s month of unrest, with the possibility of more strikes to come, has taken place despite warnings that the country’s 80 per cent debt-to-GDP ratio threatens its economic future. In Spain, where the annual deficit now stands at 11 per cent of GDP, a 24-hour general strike on Sept. 29 brought the country to a standstill, with more planned in protest of a labour reform bill tabled by Prime Minister José Luis Rodríguez Zapatero. In Italy, thousands joined a march in Rome organized by labour, while Britain faced a growing backlash to budget measures that would see nearly 500,000 civil servants axed from the public payroll: an Oct. 19 protest against the cuts at Westminster came two weeks after rail workers staged a 24-hour strike over staffing levels that shut down London’s underground. This despite a $250-billion deficit in Britain that, measured against GDP, is third worst in the world.

All of this has taken place against the backdrop of Greece’s financial catastrophe—a lesson on the dangers of fiscal procrastination if ever there was one. Two weeks ago, striking civil servants in that country shut down schools and tax offices in an aftershock from violent spring demonstrations that saw rioters in Athens tear-gassed and three people killed by a Molotov cocktail. What the bureaucrats expected to accomplish wasn’t clear. Their country is unable to borrow on the open market, while a recent crackdown on tax evasion drew as much public anger as the government’s aggressive cost-cutting program. Even if their politicians wanted to keep paying civil servants, they couldn’t find the money.

The reaction has fuelled fears that desperately needed financial reforms will run up against a sort of collective blindness—a peculiarly European belief that the cherished welfare state could defy the cold math of weak economies and aging workforces. “To us, something like raising the retirement age seems like a pragmatic step,” says Timothy Smith, a history professor at Queen’s University and author of France in Crisis, a 2004 book arguing that the French model is collapsing. “But the French have invested so much hope and energy in their social welfare system that having to give any of that up provokes this sort of reaction,” he says. That reflex is born partly of genuine egalitarianism, he says, but it also reflects a long-standing suspicion of employment as an instrument of capitalism. “In France,” says Smith, “work is seen by many people as oppressive.”

The irony, of course, is that if you have a job, there are few better places to work than Western Europe. Consider France, where, weeks after giving birth, women are offered state-paid, one-on-one, extended courses in vaginal therapy. The training, known as la rééducation périnéale après accouchement, or “perineal retraining after childbirth,” includes a personal trainer known as a kinesitherapist, along with wands and electric devices meant to strengthen muscles in the birth canal. After vaginal re-education, French women are then offered extended courses in abdominal training, aimed at flattening their tummies. The state picks up the tab for that, too.

It’s the beginning of an exhaustive, heavily subsidized set of benefits that carries through until a child reaches young adulthood—all in the name of encouraging French women to have children. The program begins with a birth or adoption bonus, a four-month paid maternity leave, plus a basic allowance. Laws allow a woman to opt not to work until her child is three, and guarantees her a full-time job on her return. At that point, the child is eligible for state-funded daycare, which runs to kindergarten, and every fall, parents receive a grant for every child they return to school, amounting to $420 for children over 11 this year. They also receive a housing benefit, tax benefits, and discounts on public transit, cultural events and shopping. In the summer, children are entitled to subsidized, full-day summer camps with activities like trips to the museum, farms and pools along with three square meals (and snacks). For some parents, daily fees for the camps start at as little as 65 cents.

Similar, if less extensive benefits prevail throughout the Continent, with each country adding its unique selection of perks. Ailing Greeks can tap a public insurance program for spa therapy, which aims to heal via “curing waters” or “aerotherapy,” which exposes patients to changes in atmospheric pressure. Pregnant Swedes are entitled to prenatal leave if they do work that can be considered physically demanding, while Germans who fall ill get domestic nurses if no one at home can provide them with attention and care.

You might think this sort of generosity would flag in a stagnant economy, but benefit-minded public officials remain emboldened. In April, the EU declared tourism to be a “human right,” meaning students, retirees and low-income earners would have their travel subsidized. Among other things, officials envisioned sending Greeks and Italians to England to tour “archaeological and industrial sites” such as shuttered mines, factories and power plants—and vice versa. The scheme was inspired by a European Parliament program that sends the children of Brussels Eurocrats to the Italian Alps on ski holidays and to summer camps in France, Malta, Germany and Brighton—all courtesy of EU taxpayers.

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  • M_A_D_world

    How and why can't people understand that EVERYTHING has a cost. Services, goods, and even intellectual property has something expended before it can be gained. Yet they expect it to be covered by someone else if not outright a magical right of existence.
    We have become a society that no longer respects the value of work or why it should be valued. There's a hard price to find out that you are entitled nothing that can't be taken away because you never earned it.

  • harebell

    In your attempt to jeer at the Euros you also take a pop at a population invested in what its government does. Why? Public vigilance and care keeps the government on their toes and prevents abuses of power like the scandalous behaviour of officialdom at the recent G20 meetings in Toronto. Our population should be on the streets protesting at the behaviour of the state on that occasion.
    But no they all quietly returned to averting their gaze, and that is the real scandal.
    The Euros seem not to want to go meekly into the night this time, it saddens me that you think doing otherwise is a virtue.

  • Diogenes54

    A smug and condescending piece – cherry picking statistics and stories to suit it's aim.

    Yes; there are many protests about raising the retirement age, but at least EU countries are now doing something about it. It will have to happen in Canada as well – but do we even hear any discussion about it now? NO,

    For every story of whiny workers in France and Germany making outrageous claims against employers, there is an equally outrageous story of a worker in Canada who was capriciously fired with NO severance, NO rights, and NO recourse (think Tim Hortons). You think our government is there to protect the little guy? Yeah, right, whatever.

    Remember last year when Nortel was being auctioned off and Nortel pensioners were protesting on Parliament hill because their pension plans were being stripped owing to the Nortel bankruptcy? Flaherty was saying there is nothing they can do about it – provincial responsibility you know – and Harper was making some stupid announcement at a Tim Hortons "Innovation Center".

    In 2007 there was the made-in-canada Asset Backed Commercial Paper (ABCP) crisis. People who had their OWN, self funded, RRSP retirement funds were suddenly told that most of the money was gone, and that was that. The big banks and investment dealers almost got away with that one,

    And finally, the GDP per worker figures for many EU countries are close to, and sometimes better than those of Canada, in spite of the fact that Europeans have more vacation time. We will let the readers decide for themselves how Canada's resource based economy should factor any benefit into that equation.

    The list could go on – from coalition governments, health care, public transport, to shelter for the homeless – but this would turn into a f***ing rant (maybe it already has) so I'll stop soon.

    I have lived in Europe now for 4 years now; versus some 50 years in Canada. I'm impressed. A lot of things simply work better. Canadians could learn a thing or two about a thing or two.

    Just don't expect to learn about them from Ignatieff or Harper. Tweedelee-dee; Tweedelee-dum.

    • canucklehead

      The strongest case I've heard against serious firing laws is how the employment rates of people with disabilities went down after Americans "protected" them against prejudiced firing. John Stossel (sometimes pretty doctrinaire) quoted an employer who said they tell disabled people the job is filled now because once they're hired they're lawsuit bombs you can't fire. http://www.realclearpolitics.com/articles/2006/06…

      Getting fired unfairly isn't as bad as never getting a job in the first place – I think France's Muslim ghettos are the worst consequence of that. EI and similar programs are way better answers.

  • quelips

    I now live in France and it seems to me that they're doing something right. This article highlights extreme cases to make its points but in reality a lot of these western european countries invest smartly in their economies. They produce quality products that the rest of the world wants (ex. wine, chocolates, fashion) and invest heavily in green technology to offset imports and promote tourism (ex. T.G.V). Meanwhile canada justs sells its resources and allows the capitalist market to run the economy and ultimately decide whats good for workers (little vacation time, little investment in families or communities). I respect greatly that people in europe fight for whats important and hold their governments accountable. Also, there is much more vision and pragmatism for the future here, for example the green technology investment or the high speed train that will pay dividends in the future and will acutely offset the present day GDP ratios that this Macleans article bandies about so easily. One cannot apply north american metrics to these european countries and thusly predict disaster. A high debt to GDP in Canada is more because of wasted spending whereas at least in Europe part of the debt is reflected in furture capital projects that will be of a benefit one day.

    • alfanerd

      I now live in France and it seems to me that they're doing something right.

      Yes, it's called cheese.

    • Thwim

      I wonder if that's part of what comes from being an "older" civilization. I mean, let's face it, Canada, America, even Australia.. we're all pretty new kids on the block. Have our collective psyche's realized yet that we could be here a damned long time and so had better start planning ahead?

      I mean, we know the answer in the states where almost half of them believe the rapture is approaching, and 15% or so believe it'll happen within their lifetime.. With an attitude like that, yeah, why on earth worry about the long term?

      So is this unfortunate fixation we have on letting the markets.. which are always short term.. run our lives simply an aspect of being juvenile societies?

  • alfanerd

    The current pension systems, in US, Canada and Europe are essentially Ponzi schemes: if you want to cash in you have to do it early, before the whole thing collapses. Younger generations should be on the front lines fighting AGAINST these things, unless they want to waste their earning years funding entitlements for an older generation.

  • Tony Joanisse

    Back in the days when the former Soviet Union was supposedly a beacon to the working class, a Soviet transportation official was given a tour of the Tube by one of his counterparts in Britain. The British transportation official said, "Here in London, we have three 8-hour shifts, and the workers retire at age 65." The Soviet official said, "Why not have two 12-hour shifts and make them work until they're 70?" The British official replied, "They'd never go for that here. They're all communists."

    • canucklehead

      When Kruschev visited Ontario and they were showing off a dairy with the latest western technology what Kruschev wanted to know was how they got the workers to start at 6 am. I think I wish I lived in everyday Soviet Russia.

  • Tony Joanisse

    In the U.S., the Republicans called themselves the party of fiscal responsibility. Then George W. Bush took the federal budget that the Clinton administration had balanced after eight years and left a deficit of $3 trillion dollars with wars in Iraq and Afghanistan and 10 years of tax cuts to finance them. Not bad for a party of fiscal responsibility. If economics professors are teaching their students that you can finance wars through tax cuts, then the whole discipline of economics must come into question. Could be, economists don't know s*** about business.

    • canucklehead

      well, as the tax rate approaches 0 revenue goes down but as the tax rate approaches 100 revenue also goes down. Cuts increased revenue in the States in the 1920s and after Reagan's and Kennedy's cuts. Bush's cuts reduced the taxes of everyone but the top bracket who paid less by percentage but still more in actual total.

      Our true choice is not between tax reduction, on the one hand, and the avoidance of large Federal deficits on the other. It is increasingly clear that no matter what party is in power, so long as our national security needs keep rising, an economy hampered by restrictive tax rates will never produce enough revenues to balance our budget just as it will never produce enough jobs or enough profits… it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.

      JFK's words… sounds pretty similar to Laurier. Two sources of "conservative" fiscal thought I never expected.

      • Riley

        This is just factually wrong. tax cuts to not increase government revenues. No government has ever balanced the budget by cutting taxes and increasing spending. It defies logic and only wins votes because of our pathetic "get something for nothing" cultural mindset. It's the same reason the gambling "industry" is so popular. Europeans run their economies much more smartly. Houses are built to last. Transit is built to actually move people around where they want to go, when they want to go. Canada has fallen to 8th place on the Human Development index after being 1 through much of the 1990s (welcome to Harper's Canada). You cannot have Swedish social services on an Alabama budget. Period.

  • Chase99

    Say what you want of the French welfare state, I kind of get why the French are mad. Sarkozy who claims to be a fiscal conservative almost tripled his salary in 2007 when he came to power and is currently collecting two pensions from prior public service! MMMMM

  • Amssss

    I LOVE EUROPEEEEEEEEEEE

  • JoeC

    This problem is more generalized than just Europe. Let us not forget that right wing governments in Canada and the US have been posting record-breaking deficits.

    This is a problem in the west of people not wanting to pay for the things they want now, and it infects members of both the right and the left. They want someone in the distant future to have to pay for whatever it is that they think they need/want, whether that's healthcare, or militaries. It's nuts, and it has to stop.

  • JWB

    This is why Canadian citizens must keep a leash on our own social left idealists. The entitlement mentality of this country must end so we don't end up like Europe. Or the US for that matter. All it would take is one more Trudeau in this country to spell the end of our economic prosperity. Canada cannot be too smug about our position, we are not far off having similar problems.

  • jonathan

    In Canada many years of left-wing gov. created huge deficit.
    In US Obama-socialist increased unemployment and plans to have welfare-state as well.

  • MaggiesFarmboy

    Come again?

  • JoeC

    Look up "left wing" and "socialist" and try again.

    And while you're at it, look up some Canadian history – it was the LPC that started getting us out of deficit, and the PC's and CPC that screwed our economy.

  • jonathan

    Yeah? Look what McGuinty did to Ontario. We have higher debt per resident than California !!
    Pile of ca$h wasted by libtards on ideologically twisted eco-nuts projects.
    $2B trashed on non existing E-Health system.
    Overblown welfare system for newcomers who are not even willing to get a job!

  • alfanerd

    You have to be willfully blind to try and tar both the left and the right on this one. Everybody knows what the solution to this mess is: cut public expenditures massively. And lets see who supports this move: if the left supports massive cuts to public expenditures i'll eat my words but most likely they'll just become angry and violent like in France and Greece.

    In US, the Tea Party's philosophy of cutting government spending has earned them all sorts of nice names, like fascist, racist, and the like, all from the left wing.

    So, the choice is clear, you either support the right and you support massive cuts in public spending, thereby saving future generations from a crushing debt burden, or you support the left and the unions and you dont cut public spending and you give the finger to future generations.

  • Jose M. Ruiz

    No that’s not true they befitted from Brian Mulroney and his GST. He lowered taxes and let the economy to grow. We had our own fit like the French and wiped out the PC party and Liberals slashed all are benefits and called themselves economic Gurus.

  • Daniel

    Yeah people dont you remember the huge surplus after Mulroney!…oh wait…

  • chester good

    …And don't forget Bob RaeDAY (MAY DAY MAY DAY!) and his Pink Floyd Treasurer's ballooning deficit.

  • canucklehead

    Mulroney added nothing to the deficit other than interest payments on the Diefenbaker/Trudeau debt. (At least, that's his claim in his book) He turned it around, particularly with the GST.

  • Oakeshott

    Thank for your 'clear' choice. Your powers of deductive reasoning are impressive.

  • Thwim

    The "mess" is there being no money for pensions for the retiring boomers who've been eating up the resources of our countries for years now.

    You're saying that in order to preserve those pensions for the boomers, we need to cut all the other services government provides now? Typical.

    Here's a thought — how about we just cut the pensions and let the boomers survive under their own power for once, while using the money from that to give younger Canadians a bit of a head start.. maybe forgive them their student loan debts so that they can actually start getting out in the world and building the economy for tomorrow.

  • Olivier

    The Germans have a very sober (and, on paper, effective) plan on reducing their deficit and so do the Brits.

    Obviously a lot of people are not going to be happy with government cuts, this is true everywhere, but so far the French and the Greeks and the only ones who have taken things to far. And somehow Europe is losing it's cool?

    Pathetic article and a feeble attempt to cash in on the anti-spending movement.

  • http://intensedebate.com/people/Ottawa_Centrist Ottawa_Centrist

    One more Trudeau, or perhaps more deficit records from Harper?

    It isn't the left's fault we are here. It is the left and rights fault and trying to lay blame rather than take action and responsibility is a counter-productive distraction.

  • alfanerd

    I agree on that – make the boomers pay not younger Canadians. The math just doesnt add up for pensions, and as for government services generally, we just need to live within our means. Again, it will be younger Canadians who will be paying our parent's tab for most of our working lives.

  • J MacDonald

    Why are we criticizing France for not adopting America's ideals of an absolutely underpaid, overworked, no-social-support fueled workforce? Bless the French for still having a back bone to stand up against "business as usual beats workers' well being". Just because America – and Canada for some reason – have been sold on this stupid idea that equality is a blessing the government hands down only when we can conveniently afford it doesn't mean that we should be preaching to a country that are healthier than us is most every quantifiable way.

    This isn't even an article, it's a soapbox. It's not impartial, it's not conveying level facts for the reader to interpret, it's condemning another country's people and it's shameful. This stinks like Fox News through and through.

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