France: One Step Forward, Two Steps Back

Opinion pieces and speeches by EPI staff and associates.

[ THIS PIECE ORIGINALLY APPEARED IN PAJAMASMEDIA.COM BLOG ON MAY 7, 2007. ]

Read comments for this blog entry.

As I write, French socialist presidential candidate Ségolène Royal has just gone down to a thumping defeat. Some will attribute it to dissatisfaction with the chronically weak economies characteristic of social-democratic systems. They need to find better reasons, since the purported economic weakness of Old Europe is a conservatarian urban legend. Gross Domestic Product (GDP) per capita is higher in the U.S., but that’s because we work more hours, not because we are more productive. Like other Europeans, the French have decided to work less and enjoy it more.

The conservative victor in the election — Nicolas Sarkozy — campaigned on a commitment to allow for tax-free, voluntary overtime. This is not the same thing as cutting a fringe benefit like paid leave. To some Sarkozy voters, the overtime option undoubtedly appears to be all carrot and no stick. Possible problems include employers demanding overtime (as some used to say in the U.S., “If you don’t come in on Sunday, don’t bother coming in Monday”), overtime pay substituting for regular hourly wages, and overtime reducing jobs. Sarkozy may try and launch a frontal attack on the welfare state, but that battle has yet to be joined. George W. Bush didn’t do himself any good by proposing to gut Social Security.

In the conservative economic solar system, GDP is the Sun and non-market amenities are a distant planet. But any econ textbook will tell you GDP is not synonymous with well-being. The problem is that well-being is hard to define, let alone measure, so we tend to fall back on GDP. If, for example, the day magically extended by one hour that we could all devote to leisure, the GDP accounts would not reflect any such improvement.

This summer, how many paid vacation days have you to look forward to? In the U.S., after one year of employment, the average benefit is 8.9 days of paid leave. Not until you get to 25 years of employment does the average get up to 19.2. By contrast, in European countries, the mandated minimum is at least 20 days. In France it’s 25 days.

Those lazy bums! Not quite. As you can see from the table below, data courtesy of the OECD, when they do work, the French are actually a hair more productive than U.S. workers. Workers in five other European countries with big public sectors are also more productive. Productivity growth in most European nations compares well with the U.S.

I would not make a big deal about the small difference in 2005 between the U.S. and France. The point is that productivity in the Euro-socialist nations is comparable to the U.S., notwithstanding popular rhetoric to the contrary. Call me crazy, but I think that if you take a few more days off, you could be just as productive, maybe more so, for the remaining, fewer days that you do work.

Workers of the world! You have nothing to lose but a few laps in the rat race, and a suntan to win!

Max Sawicky is an economist at the Economic Policy Institute in Washington, D.C.

[ POSTED TO VIEWPOINTS ON JUNE 12, 2007. ]