Popular protests in the EU

[AdrienIer]

How is it going in France now?

Strike is still going on. The government is trying to look strong but it's not working very well. This week will be important : tomorrow is a big strike day with many protests, wednesday the government will publish the exact text of their proposed reform. Meanwhile it's been revealed that the guy in charge of putting together this reform "forgot" to reveal his ties to the insurance industry when many insurance companies will benefit from the changes.

And fun fact : the first day of strike on thursday had larger protests than the first day of the 1995 strikes that forced that government to backpedal its pension reform. We'll see if the strike lasts as long and gets the same result.

 

[innonimatu]

Meanwhile it's been revealed that the guy in charge of putting together this reform "forgot" to reveal his ties to the insurance industry when many insurance companies will benefit from the changes.

So very typical of the world at this stage, not just France.

I think Macron will just ignore protests and try to have his legislation passed, if they don't threaten to actually topple the government from the street. Losing reelection is not much of a deterrent to a bunch of people who have assured places in the "private sector" (state fed...) they're benefiting with the legislation. Legalized bribery on a grand scale...

 

[innonimatu]

The french know how to protest!

They're selectively cutting services to the "owners of the country":

France’s trade unions on Wednesday defended their decision to cut power to thousands of homes, companies and even the Bank of France to force the government to drop a wide-ranging pension reform.
The power cuts, illegal under French law, deepened a sense of chaos in the second week of nationwide strikes that have crippled transport, shut schools and brought more than half a million people onto the street against President Emmanuel Macron’s reform.
Asked on French radio whether the power cuts weren’t a step too far, Philippe Martinez, the head of the hardline CGT union, said the cuts were necessary to force Macron to back down.
“I understand these workers’ anger,” the mustachioed union leader said. “These are targeted cuts. You’ll understand that spitting on the public service can make some of us angry.”

 

[EnglishEdward]

In what way is the French legislation pension reform being applied:

Is it being applied to:

(a) existing pensioners;
(b) existing employees; and/or
(c) new hires?

 

[AdrienIer]

b and c. With the people born before 1975 getting a watered down version of it.

 

[innonimatu]

b and c. With the people born before 1975 getting a watered down version of it.

Again, the usual: trying to divide opposition to it by applying the change only to some people, gradually. But those older pensioners have sons and daughters. I don't think they're going to be bribed into remaining quiet.

 

[AdrienIer]

Yeah, the general reaction has been "I'm not throwing my child under the bus"

 

[EnglishEdward]

b and c. With the people born before 1975 getting a watered down version of it.

Thank you for providing that particular detail.

I joined the UK civil service in 1978. They started reducing the so called "gold plated" benefits
for those joining in 1986, and then made further reductions for those who joined the service later.

Nevertheless I expect they will cut my pension anyway when the next recession bites deeply.

There is a fundamental issue in that people are living longer (excepting Scotland) and starting
work later and often being retired earlier so there are less active years to support the inactive years.

 

[Hrothbern]

There is a fundamental issue in that people are living longer (excepting Scotland) and starting
work later and often being retired earlier so there are less active years to support the inactive years.

yes
And the only "convenient" escape is increasing labour productivity enough.
Like with the choice between lead or silver... it is the choice between sweat or smart

 

[EnglishEdward]

UK productivity growth is abysmally low at 0.3%
pa, but that is quite a separate topic in itself.

 

[innonimatu]

Beware that talk of productivity is usually used to disguise the politically-driven transfer of wealth towards the top. Consider this OECD report.

Trends in labour shares are to a large extent driven by the comparative evolution of average wages and labour productivity. Under most circumstances, when average wages increase more rapidly than average labour productivity, the labour share increases. Conversely, when the growth in average wages lags the growth in labour productivity, the result is a decline in the labour share.
...
The OECD (2012) has observed, for example, that over the period from 1990 to 2009 the share of labour compensation in national income declined in 26 out of 30 advanced countries for which data were available, and calculated that the median (adjusted) labour share of national income across these countries fell from 66.1 per cent to 61.7 per cent.
...
a majority of large economies, including the United States, Germany and Japan, have seen wage growth lagging behind productivity growth, labour productivity has outpaced real average wage growthin a group of nine advanced G20 economies for which data is available since 1999 (Figure 5).
...
Interestingly, this decline is widespread across industries, since essentially all industries experienced a considerable decline of the labour share in the last 20 years.

The fact is that workers have been gradually screwed out of their share of the created national wealth, for the benefit of the capitalist owners of business. The labour share in the UK fell by 6% of GDP, and in France 7%, between 1970 and 2014. In Spain it fell 14%, and 13% in Italy.

It is often countered by propaganda types that "workers are also owners, private pension funds etc etc"... but again facts show that reality is different. Capital is concentrated in the hands of a few, and the nature of the system drives further concentration. Therefore the capital share of wealth is far less equally distributed than the wage share. There is no way that the capital share is going to support pensioners. It's supporting the personal empires of the wealthy.

Declining labour shares are frequently associated with more income inequality because capital is more concentrated than labour endowments. At the same time, the relationship between factor shares and personal distribution can be relatively complex because economic agents derive their earnings from several different sources. Some studies have combined factor shares with distributional data. The ILO (2011) found falling labour shares for low-and medium-skilled workers, but increasing shares for highly skilled workers in sample of ten developed economies. The OECD (2012) showed that the labour share diminished for the bottom 99 per cent of income earners, but increased by 20 per cent for the top 1 per cent in countries for which data was available over the last two decades (OECD, 2012).

This 1% is basically mangers giving themselves high wages and claiming "because I'm very productive".

Recent work (e.g.OECD, 2011a, Atkinson et al.,2011) shows that top income earners have seen their share of national income increase. One study shows that in Europe, the top 10 per cent in the wage distribution earns 25 per cent of the total wage bill while the top 10 per cent in the capital distribution owns 60 per centof total capital, so that - ultimately - the top 10 per cent in the distribution of incomes (wages and capital) obtains 35 per cent of national income. In the U.S., these figures for the top 10 per cent are estimated, respectively, at 35 per cent for wages, 70 per cent for capital, and 50 per cent for incomes (wages and capital) (Piketty, 2013). Although not demonstrating causality, Figure 6 suggests that the decline of the labour share tended to evolve hand-in-hand with the widening of market-income inequalities. Fiscal consolidation in 17 OECD countries over the period 1978-2009 has also had distributional effects by raising inequality and decreasing labour income shares (Ball et al., 2013).

"Fiscal consolidation" meaning lower taxes on capital and the end of progressive taxation. Before that managers giving themselves higher wages or owners taking out a greater share in profits would be heavily taxed, meaning there was less "incentive" to do it: they could not get away easily with profiting from wealth so diverted.

The facts are known and acknowledged. There is no problem with productivity growth, there is no lack of resources to support pensioners, there was a politically-engineered large-scale transfer of wealth way from the common citizen and towards a very small wealthy elite. What Macron is trying to do is more of the same, because what the hell if the Italians and the spanish wealthy grabbed so much more, the french want it too! People like Macron will continue to push "reforms" to transfer wreath to their own class (just look at Macron's career...), as they have been doing since the 1970s. Not because "it is necessary", but because they are greedy and can do it. Or think they can.

 

[EnglishEdward]

It seems to me that there is a Guns v Butter debate going on within the EU.

https://www.theguardian.com/world/2...ut-funds-for-poor-in-post-brexit-cost-savings

The European Commission has been accused of seeking to cut EU funding for the continent’s poorest people
by 50% to secure post-Brexit cost savings and extra funds for defence projects.

Jacques Vandenschrik, the president of the European Food Banks Federation, said the EU executive’s proposed spending
plans for the next seven years posed a risk not only to the most vulnerable but to the stability of wider society.