Voices

France and the failure of socialism

By Dania Koleilat Khatib   |   Dec. 12, 2018 at 9:24 AM
A protester hurls an object at police during a demonstration in Paris, France, on December 8. Photo by Julien de Rosa/EPA-EFE

Dec. 12 (UPI) -- The demonstrations that France had witnessed for four weeks in a row go beyond a protest over a half-euro increase in the price of fuel. They also go beyond Macron's policies.

Though Macron ended up by bowing to the Yellow vests demands, the problems are far from over. The tax on fuel is, as we say in Arabic, the straw that split the camel's back. The problem in France is structural. The system cannot sustain itself anymore. The popular discontent is a signal that socialism has failed to offer what it has promised the people. In theory, socialism is based on providing equality between human beings. The more fortunate are taxed to subsidize the less fortunate so that people are equal and everyone has a decent living.

In theory, it is nice and dandy but in practice the results are far from what is expected.

Socialism did bring a system where people are not enticed to improve or progress as every advancement in income will be eaten up by taxes. People are encouraged to work less, and not more. It resulted in excessive welfare often abused by many people who are not in need. It resulted in an inflated bureaucracy similar to that of third-world countries.

In a way, France has the top welfare system in the world -- but at the same time, some people can't feed their families because they live on such a small salary. What is the solution? Eighty percent of French people are against Macron. The damage is irreparable and will have a permanent effect on Macron's presidency. Macron has to pull a rabbit out of a hat in order to get his popularity restored. A foreign policy win hyping on the national pride could appease the public for a while, but not for long.

Internal structural reforms are needed to regain public approval. Reform is hard but it is needed. France cannot afford the current form of socialism. The system is going to crash under its own weight. The French system faces three major hurdles -- bloated bureaucracy, excessive welfare system and rigid employment laws. France is the only country where people only work 35 hours a week. It is almost impossible to fire anyone, which renders the cost of employment exorbitant for businesses. Unemployment is partly caused by the high cost of employment. Partly, is it due to the fact that European economies are quite mature and there is little room for growth.

However, those three areas need to be tackled in a manner that will not unleash a revolution. People are rarely willing to give up a direct privilege for the benefit of all. No one willingly will work for 9 hours when he can only work for 7. This is why the government should look for easy entry points to initiate reform. Two years ago, the passing of "Khomri law," set to reform labor law and to make the labor market more flexible and competitive, was faced with massive protests and strikes -- something the Macron government cannot afford at the moment.

The starting point should be a decrease in spending. Macron should work on shrinking the size of government. Freezing hiring, restructuring and rendering the government more efficient is needed. The other area would be the welfare system. Since August, Macron has targeted a cut in welfare spending as growth was faltering. However, the government did not pursue the plan, fearing the cut would lead to popular upheaval.

It is very difficult to take away from people what they perceive as an acquired right. Therefore, the starting point could be a stricter vetting mechanism coupled with heavy fines for those who have abused the system. In addition to that, Macron should be closer to his citizens. He is described as arrogant and aloof by the French and as the "president of the rich". He should communicate better with his citizens and explain to them that his aim is to remove redundancy, corruption and free riders. He must tell them that his aim is not to make the rich richer but to boost employment. Starting with this narrative Macron might have a chance to regain his people's trust. And he might be able to start the long strenuous process of reform.

Despite that, changing a system that has been in place for decades, to which people are accustomed, is an uphill battle.

Dania Koleilat Khatib is executive director of the Al Istishari Al Strategy Center for Economic and Future Studies, a UAE-based independent think tank. She specializes in U.S.-Arab relations and researches sectarianism, extremism and governance. Her book "The Arab Lobby and the U.S.: Factors for Success and Failure" was published by Routledge UK and translated to Arabic.

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