The government is on the brink of collapse over planned austerity. Instead it must face up to the costs of its unnecessarily rigid labour market
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s someone who has always been against austerity, I find France, with a national debt at 114% of GDP and a budget deficit of 5.8% of GDP, a conundrum. Despite years of denunciation from his left and far-right opponents that Macron has engaged in “ultraneoliberalism”, there hasn’t been any. Not on a macro level, anyway, where both French government spending (57.3% of GDP) and tax receipts (51.4% of GDP) are among the highest in the world, including social spending, which outpaces any of its European neighbours.
At the same time, it’s impossible to have spent the past decade in France without encountering the widely shared perception and accusation that public services are in decline. Doctors and nurses denounce a labour shortage in public hospitals; people who live in rural areas denounce the closing of rural train lines; students and academics denounce a lack of resources for public universities, many of which are dealing with outdated infrastructure, and for research.
Some of the responses to this aren’t strictly financial. Nearly every country in the world is dealing with a shortage of medical personnel, which in France has been exacerbated by caps on medical school admissions that were finally lifted in 2020. And over the past 25 years, France has seen an increase in urbanisation, from 76% to 82%. Maintaining the same level of transportation and other services to shrinking rural towns and villages would mean far higher spending per person than for those who live in cities, ultimately diverting resources from something (whatever, and wherever, that is) and raising a fundamental question of fairness. The French, for their part, see the downside to the concentration of policymaking in Paris and overwhelmingly want more decentralisation.
