French pension reform

The invaluable Andrew Samwick points to this story on another attempt to reform French pensions:

Nicolas Sarkozy is eyeing off the pensions of public servants.

In 1995, moves to reform France's pension system led to weeks of protests.

Now, the new French President has announced a package aimed at cutting benefits to workers like train drivers and electricity workers, who until now could retire early.

Mr Sarkozy says the system is financially unsustainable and he has pledged to negotiate with unions and companies, but he insists the new system will be implemented without delay.

He'll need more than a bit of luck. In 2003, roughly the same reform touched off a series of crippling strikes (which is still better than 1995, when an attempt to reform pensions ultimately brought down Alain Juppe, the prime minister.) That's why the train and utility workers were exempted from the last deal: for some reason, railroad unions tend to be especially militant, and both groups have the ability to bring the country to a screeching standstill. It's annoying if you can't get your driver's license renewed, but really a tad worrisome if the power to work your ventilator goes offline.

Nonetheless, he has to do something; lavish public sector pensions pose a potentially crippling burden on a government that already has quite a lot to do figuring out how to fund all that health care for the elderly. And having forced the reform down everyone else's throats, the government may be in a better public position, since now other civil servants will resent the special privilege.

Comments

Personnally I think Sarkozy should channel Regan and fire those that try to strangle the country for their own gain.

Posted by Curious Texan | September 19, 2007 6:58 PM

Curious Texan:
I think you missed the point of the article. The French are a lot more willing to riot in the streets over a perceived slight. Channeling Ray-gun won't work in France, unless Sarkozy wants to have a short run as PM.

Posted by Joe Klein's conscience | September 19, 2007 9:10 PM

Yes, Madam Conscience, the French are very happy to riot...look at all those charred cars from 3 years back. Blasting down a building or two won't give them their ill-gottten pensions back, but it might create more housing for the homeless. At least they'll have a socially responsible outcome to their nose-cutting.

Posted by beneficial | September 19, 2007 9:53 PM

It's not just a French problem. Public employee pensions are a major financial burden for some local governments in the United States.

Posted by Peter | September 20, 2007 9:45 AM

I’d bet that the French government is able to reform public sector pensions before Pittsburgh can. The local machine would rather drive the whole (private sector) middle class to the suburbs before cutting a union pension plan.

Posted by MH | September 20, 2007 9:45 AM