The scene in France these days evokes a feeling of Old Europe. In Iraq we fight with robotic airplanes and night-vision, but the battles between the French and the riot police look like something out of Lord of the Rings. Disdaining guns, the armored police carry clubs and tall shields, while the protestors wage war with cobblestones, their picket signs reminiscent of a forest of spears floating above the crowd. The two lines of battle roll towards each other and erupt in violence until their differences are resolved. It would make Joan of Arc proud, but I doubt that it will reduce unemployment.
The protest riots, which began late on March 18 are responding to a law creating a new type of employment contract called Contrat Premiere Embauche (CPE). The CPE allows companies to fire new employees under 26 for any—or no—reason during their first two years, after which they are granted an indefinite contract with extremely strong job protection. The idea is to make hiring kids less risky to businesses. If companies can hire young people without having to guarantee them life-long employment, they will be more willing to do so.
Any Sorbonne student in a basic economics class can verify that reducing job protection encourages job creation and reduces high unemployment, which is currently at 9.6% in France and 23% among youth. And it’s no secret that the inflexible French labor system is a competitive disadvantage in an increasingly globalized world.
The CPE, however, is just a quick fix. Though it should lower unemployment somewhat among the youth, it still leaves France with a labor pool that remains fluid for only two years. After that period, it removes all incentive for experienced workers to change industries or create their own businesses. It is hardly more flexible than the current system.
There are more logical ways to fix this. Why not increase job protection according to seniority instead of letting people put their feet up after two years? What French labor needs is an overhaul, not a tune-up.
But instead of explaining this painful necessity to the populace, de Villepin decided to blindside them, choosing to sneak the bill through the French National Assembly at 2 a.m., while 197 out of the 250 total representatives were home sleeping.
Now the students and the unions, angry both about the content of the bill and the fact that they were not consulted, have taken to the streets, staging five major national protests and strikes. They refuse even to negotiate, instead giving President Jacques Chirac until April 15 to repeal the law or face even more disruptions.
The most painful aspect of the situation is that protecting job security has now become a rallying cry. These events will be a significant obstacle to the more thorough reforms that will be necessary in the future. If the protestors win, the law will be repealed, and just touching job security will become a political taboo. The other possibility is that the protestors will lose interest with the arrival of spring break in the middle of April and the CPE will enter the books, taking the place of a genuine labor reform. Neither case is good for France, but they do have a history of emerging from political chaos stronger than ever. Perhaps this is just a remnant of the old Gallic way of getting things done.
