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	<title>Comments on: The French Unrest and the Labour Market</title>
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	<link>http://fistfulofeuros.net/afem/western-and-central-europe/the-french-unrest-and-the-labour-market/</link>
	<description>European Opinion</description>
	<pubDate>Thu, 04 Dec 2008 20:43:12 +0000</pubDate>
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		<title>By: Joerg Wenck</title>
		<link>http://fistfulofeuros.net/afem/western-and-central-europe/the-french-unrest-and-the-labour-market/#comment-1623</link>
		<dc:creator>Joerg Wenck</dc:creator>
		<pubDate>Thu, 17 Nov 2005 00:24:39 +0000</pubDate>
		<guid isPermaLink="false">http://fistfulofeuros.net/wordpress/?p=2075#comment-1623</guid>
		<description>I commented on Cheney when you plugged him on AFOE. You are invited to take up the argument. 

Essentially Cheney proposes creating an underclass along the lines of the U.S. model. Currently the French unemployment rate is twice as high as the poverty rate. In the U.S. the opposite relationship obtains: poverty is twice as high as unemployment. Note, though, that that figure applies to the population as a whole. Among black Americans both unemployment and poverty are much higher.

The last fourty years have produced a steady deterioration in the social status of black Americans: successful family formation has become the exception rather than the norm.
Among the causes:
a) "affirmative action" - blacks are put out to pasture on a virtual educational reservation where they don´t need to compete on equal terms. It works brilliantly: the black leadership fights tooth and nail over the right to be oppressed and disadvantaged by means of Potemkinesque standards. 
b) "penal Keynesianism" - the U.S. is a global leader in incarceration. Allegedly there has been a successful war on crime. What that means is that lots of people (primarily blacks) have been locked up. In due course the number of criminal acts dropped sharply. The quantitative dimension of this societal change is nothing short of breathtaking: if authorities in the U.S. had locked away as many putative criminals per one thousand criminal acts registered by the police during Reagan´s first year in office as they routinely do now, there would have been 1.6 million more people behind bars at that time than there actually were. 

Sarkozy has indicated that he intends to fashion his strategy for dealing with the aftermath of the French riots along the lines of the model provided by the response of American society to the unrest of the 1960s and 1970s. There are no signs that the outcome would be any different from that in the U.S., however. Overall unemployment would fall, since prison inhabitants are not counted among the unemployed. Law and order would be restored. Economic segregation would be maintained - and possibly entrenched further - by means of two mechanisms: 
a) removing incentives where they are needed, i.e., in the educational system (which cannot function without proper assessment of individual merit and achievement),
b) providing incentives where they are counterproductive and contribute towards the splitup of families. A minimum wage (in conjunction with actual job offers, provided - if necessary - by a government agency entrusted with the task to act as an employer-of-last-resort) differs from welfare payments in that it doesn´t motivate couples and families to break up in order to maximize welfare receipts (a lesson German politicians chose to ignore in the design of the Hartz IV measures - with results that, as  predictable as they were, seem to have genuinely surprised the officials in charge of implementing Hartz IV).

The western world is in the process of creating  a historically unique phenomenon: nuclear families that are incentivized to hide from public view and considered to be fair game 
for government bureaucrats who take it upon themselves to interfere with their everyday lives because they are entrusted with the task of distributing alms. In this scenario, the concept of an exchange doesn´t exist: the poor don´t give anything in return - such as their labour at a minimum-wage job or the effort to try to keep up at school - because nothing is demanded and expected of them anymore (apart from compliance with the law, which is enforced in an ever stricter fashion.) 

It is instructive to realize that a sizeable part of the black population in the U.S. has converted to Islam. Whether the spread of Islam will be conducive to stability and prosperity in Western countries is very much an open question. Much less open is the question whether Islam will become an increasingly attractive option for those who are being dealt with as dishonestly
as African-Americans are. 

Pollsters regularly ask people what values they cherish most. Usually honesty tops the list of answers given. This fact isn´t reflected in economists´ calculus of utility. Thus economists regularly mispredict the impact of measures they propose. Nowhere is this more evident than in the domain of anti-poverty policies. If France really follows the example of the U.S., poor French will end up taking on second jobs that used to be done by immigrants. Labour market (in)flexibility is nothing but a veil that exposes or hides this effect, depending on how the screws are adjusted.


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		<content:encoded><![CDATA[<p>I commented on Cheney when you plugged him on AFOE. You are invited to take up the argument. </p>
<p>Essentially Cheney proposes creating an underclass along the lines of the U.S. model. Currently the French unemployment rate is twice as high as the poverty rate. In the U.S. the opposite relationship obtains: poverty is twice as high as unemployment. Note, though, that that figure applies to the population as a whole. Among black Americans both unemployment and poverty are much higher.</p>
<p>The last fourty years have produced a steady deterioration in the social status of black Americans: successful family formation has become the exception rather than the norm.<br />
Among the causes:<br />
a) &#8220;affirmative action&#8221; - blacks are put out to pasture on a virtual educational reservation where they don´t need to compete on equal terms. It works brilliantly: the black leadership fights tooth and nail over the right to be oppressed and disadvantaged by means of Potemkinesque standards.<br />
b) &#8220;penal Keynesianism&#8221; - the U.S. is a global leader in incarceration. Allegedly there has been a successful war on crime. What that means is that lots of people (primarily blacks) have been locked up. In due course the number of criminal acts dropped sharply. The quantitative dimension of this societal change is nothing short of breathtaking: if authorities in the U.S. had locked away as many putative criminals per one thousand criminal acts registered by the police during Reagan´s first year in office as they routinely do now, there would have been 1.6 million more people behind bars at that time than there actually were. </p>
<p>Sarkozy has indicated that he intends to fashion his strategy for dealing with the aftermath of the French riots along the lines of the model provided by the response of American society to the unrest of the 1960s and 1970s. There are no signs that the outcome would be any different from that in the U.S., however. Overall unemployment would fall, since prison inhabitants are not counted among the unemployed. Law and order would be restored. Economic segregation would be maintained - and possibly entrenched further - by means of two mechanisms:<br />
a) removing incentives where they are needed, i.e., in the educational system (which cannot function without proper assessment of individual merit and achievement),<br />
b) providing incentives where they are counterproductive and contribute towards the splitup of families. A minimum wage (in conjunction with actual job offers, provided - if necessary - by a government agency entrusted with the task to act as an employer-of-last-resort) differs from welfare payments in that it doesn´t motivate couples and families to break up in order to maximize welfare receipts (a lesson German politicians chose to ignore in the design of the Hartz IV measures - with results that, as  predictable as they were, seem to have genuinely surprised the officials in charge of implementing Hartz IV).</p>
<p>The western world is in the process of creating  a historically unique phenomenon: nuclear families that are incentivized to hide from public view and considered to be fair game<br />
for government bureaucrats who take it upon themselves to interfere with their everyday lives because they are entrusted with the task of distributing alms. In this scenario, the concept of an exchange doesn´t exist: the poor don´t give anything in return - such as their labour at a minimum-wage job or the effort to try to keep up at school - because nothing is demanded and expected of them anymore (apart from compliance with the law, which is enforced in an ever stricter fashion.) </p>
<p>It is instructive to realize that a sizeable part of the black population in the U.S. has converted to Islam. Whether the spread of Islam will be conducive to stability and prosperity in Western countries is very much an open question. Much less open is the question whether Islam will become an increasingly attractive option for those who are being dealt with as dishonestly<br />
as African-Americans are. </p>
<p>Pollsters regularly ask people what values they cherish most. Usually honesty tops the list of answers given. This fact isn´t reflected in economists´ calculus of utility. Thus economists regularly mispredict the impact of measures they propose. Nowhere is this more evident than in the domain of anti-poverty policies. If France really follows the example of the U.S., poor French will end up taking on second jobs that used to be done by immigrants. Labour market (in)flexibility is nothing but a veil that exposes or hides this effect, depending on how the screws are adjusted.</p>
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		<title>By: Scott Willy</title>
		<link>http://fistfulofeuros.net/afem/western-and-central-europe/the-french-unrest-and-the-labour-market/#comment-1622</link>
		<dc:creator>Scott Willy</dc:creator>
		<pubDate>Fri, 11 Nov 2005 19:34:03 +0000</pubDate>
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		<description>I don't think high minimum wage is why it is difficult to create jobs in France. I believe it is more due the fact once you make a employment contract is it very expensive (and time consuming) to break it (i.e. layoff people). Small businesses are very reluctant to hire anybody because of this.</description>
		<content:encoded><![CDATA[<p>I don&#8217;t think high minimum wage is why it is difficult to create jobs in France. I believe it is more due the fact once you make a employment contract is it very expensive (and time consuming) to break it (i.e. layoff people). Small businesses are very reluctant to hire anybody because of this.</p>
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