France malade


France has become the traditional “sick man of Europe”.

“I’m prepared to spend Christmas protesting at this roundabout with my children – we won’t back down and we’ve got nothing to lose,” said a 41-year-old, who voted for Macron in last year’s presidential election. “He gave good speeches and I really believed his promises that he would change France. But not any more.”

That seems to be a typical comment of the French voter today.

A grassroots protest, which began as a spontaneous revolt against fuel tax rises, has morphed into an anti-Macron movement and is now the young centrist president’s crisis.

Macron’s critics say he is an arrogant would-be monarch. And contrary to the way he presents himself abroad, that is as a progressive hero who can hold back the tide of nationalism, at home he is a distant figure, pushing people towards an indefinable populism.

The past few weeks have seen the discontent with fringe elements fighting running battles with riot police and setting cars on fire. Paris tourist museums have had to close, and the Macron government has warned that thousands of rioters might come to the capital to “smash” or even “kill”. The rebels have taken on the ominous custom of wearing gilets jaunes [yellow jackets], normally worn by street and other workers in France in positions exposed to traffic.

Polls show Macron’s approval ratings down to 18 percent.

The failures in the French economy are the source of the discontent. France, like other Western countries, has seen a sharp rise in the difference between its richest and poorest citizens. The top 20 percent earns nearly five times as much as the bottom 20 percent. The richest 1 percent represents over 20 percent of the economy’s wealth with the median monthly income about 1,700 euros, meaning half French workers are paid less than $1,930.

All this reverses what the French had experienced since the end of World War II during a 30-year growth stretch known as “Les Trente Glorieuses” when low- and middle-incomes continued growing through the early 1980s, thanks to labor union collective bargaining agreements. But as successive left-leaning French governments sought to improve competitiveness, in part by compressing wage gains, average incomes for low- and middle-income earners stagnated, growing by 1 percent a year or less.

During the 1914-1945 period, the top 10 percent income share fell abruptly from more than 50 percent of total income on the eve of WWI to slightly more than 30 percent of total income in 1945. A rise in inequality appears during the reconstruction period and up until 1967-1968, followed by a large reduction of inequality between 1968 and 1983.

A new increase in inequality starts around 1983, as the newly elected left-wing government puts an end to the very fast rise in wages (substantially faster than output growth, particularly for bottom wages) that had occurred between 1968 and 1983.

Most importantly, the top 1 percent income share (rises significantly between 1983 and 2007, from less than 8 percent of total income to over 12 percent over this period, i.e. by more than 50 percent. This is less massive than in the U.S., but this is still fairly spectacular.

But those dynamics unraveled as successive left-leaning French governments sought to improve competitiveness in part by compressing wage gains, according to the French economist Thomas Piketty. Average incomes for low- and middle-income earners stagnated, growing by around 1 percent a year or less.

This has led to a public opinion dominated by personal disgust with Macron. He is charged with “arrogance”, citing the time he told an unemployed person to just “cross the road” to find a job, or when he wagged a finger at pensioners telling them they shouldn’t complain about rising prices cutting into their income. There is outrage too over the construction of a holiday pool in the presidential summer retreat and a refurnishing of the Paris presidential residence.

The gilets jaunes bears little resemblance to any post-World War II French because unlike Gaullism, for example, it has no single leader or is it backed by another traditional organization like the trade unions.

Its demonstrators out in the streets are a broad mix, some seeming apolitical until now, some on the traditional left opposed to “nationalism”, but also some nationalists who voted for Le Pen and environmentalists. Many have turned around the European Union, arguing it has glorified unrestrictive capitalism.

Sws-12-07-18

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