The Great Debate UK

from The Great Debate:

In France, where unions rule, a challenge from Hollande

In France, taking a person hostage or sequestering them against their will is a crime punishable by up to 20 years in jail. It also happens to be a very effective weapon in French labor disputes. Since 2009, there have been 15 incidents of “boss-napping” and only one resulted in sanctions: 11 postal workers who were fined $2,000 apiece for locking up their managers during a dispute over a change in how the mail is delivered.

Most of the time, it’s the unions who win. That’s certainly the case in the most recent incident, involving a bitter struggle over job losses at a Goodyear tire plant in Amiens. Earlier this month, union officials occupied the factory and sequestered the production manager and head of human resources for 30 hours. After the government intervened, the battle finally ended last week when the company agreed to triple the severance it had offered. Union leader Mickaël Wamen didn’t hide his triumph. “It was a grand and beautiful struggle,” he wrote in a blog post on Jan. 24, announcing details of the settlement.

This type of labor militancy is the exception in Europe today; union power has taken a battering along with the economy in crisis-ridden nations such as Greece and Spain, which were once bastions of organized labor. But it’s not the only characteristic of the French labor scene that is exceptional. Although only 8 percent of French workers actually belong to a union -- a tiny proportion by international standards --  French unions wield enormous political clout over the national economy. Among other things, they run the national systems for unemployment insurance and vocational training, in joint management with employers’ organizations. In fact, they formally play as big a role in setting social and labor policy as organized labor does in Scandinavia, where 80 percent or more of the workers are union members. “The political influence of French unions is abnormal,” says Radu Vranceanu, research director at ESSEC business school in Paris. “It’s not at all in line with their capacity to mobilize people.”

This issue of the disproportionate power of French unions has become the biggest challenge confronting President François Hollande, now that he has sorted out his private life. In an affront to unions -- and a move critics in his Socialist Party are calling a shift to the right -- Hollande is advocating a new “responsibility pact,” under which companies would see their high social security costs reduced in exchange for creating jobs. Labor unions dislike the initiative because they believe it will mean cuts to social spending, which they oppose, and they don’t trust employers to create jobs in return. Even the more moderate unions that are prepared to accept some sort of a deal are insisting on a formal list of obligations that employers must fulfill -- and are calling for a new state body to ensure that these obligations are actually met.

Was Nigel Farage right about mothers in the City?

And the award for foot in mouth this week goes to… UKIP, again. This time it was leader Nigel Farage, who said that women who take time off to have children are worth less to their employer. He said this to an audience of (presumably) men in the City and rounded it off by saying there is no sexism in financial services and that childless women are more than a match for their male counterparts.

While I am not normally in the position of defending Nigel Farage, or any other politician for that matter, I think his comments deserve our attention and women should use them to trigger an important debate about mothers and the work place.

from The Great Debate:

To boost entrepreneurship, France tries to change its attitude toward failure

When entrepreneur-turned-venture capitalist Mark Bivens first moved to Paris in 2001, he regularly introduced himself as someone who had started three software companies in the U.S., two of which had flopped. That’s a badge of honor in Silicon Valley, where failure is viewed as a rite of passage. Not in France. One day, a French colleague took Bivens aside and gave him some friendly advice: if you want to reassure people, stop talking about the companies that didn’t work out. “I soon realized that failure carries a stigma,” Bivens says.

The French word “échec” is indeed loaded with negative connotations. It starts at school, where pupils who get bad marks can be quickly branded “in a situation of failure” early in their education, and often drop out before graduating. In the business world, failure has long been fatal: bankruptcy in France is a lengthy and complicated process, and can scar entrepreneurs for life. And in addition to the logistical hurdles of starting a new business after bankruptcy, second-chance entrepreneurs must contend with the social stigma associated with failure, which makes raising funds or even opening a new bank account difficult.

Turkey – avoiding the glare of the IMF

The Turkish government has been in the news for all of the wrong reasons in recent weeks. Corruption scandals, accusations of a potential coup and fears that the government is trying to erode the independence of the judiciary have led to widespread protests. Prime Minister Erdogan’s reputation at home has undoubtedly been eroded in recent months; however the bad news could be spreading further afield.

Financial markets are a good gauge of international sentiment towards a country and right now they are dumping Turkish assets by the bucket load. The Turkish lira plunged to another record low against the US dollar this week and the Istanbul index has bucked the global trend and has fallen nearly 20% in the past 12 months.

from The Great Debate:

France says ‘Non’ to the digital age

France has kicked off 2014 with an array of skirmishes against Amazon, Google and other U.S. Internet companies, in what is shaping up as a classic battle between comfortable Gallic tradition and disruptive modernity.

On Thursday, Jan. 9, the French Senate unanimously approved a bill that would ban Amazon from offering free shipping on books in France. Strongly endorsed by the Ministry of Culture, the legislation is supposed to safeguard the existence of the country's 3,500 bookstores, about 800 of which are independent.

from The Great Debate:

Where does Britain stand in the global economic race?

Following the international financial crisis of the late 2000s, the world’s financial leaders have been working towards a standardized banking system that will strengthen banks at an individual level, and thus improve the banking sector’s ability to survive stress when it occurs.

In 2010 the Basel Committee produced a third accord outlining a set of regulations, with the goal of solving the banking system's ongoing problems. Since then the conversation has yet to cease over whether enough has been done, since the peak of the crisis in 2008, to ensure a stable financial environment that supports growth on an international scale.

Europe’s carbon trading system needs radical reform, not stop-gap measures

–Laurens de Vries is an assistant professor, Joern Richstein is a doctoral candidate, Emile Chappin is an assistant professor, and Gerard Dijkema is an associate professor at Delft University of Technology, the Netherlands. The opinions expressed are their own.–

The European Parliament voted on December 10 to delay sales of around 900 million carbon permits for the EU greenhouse-gas Emission Trading System (EU-ETS). The deferral (or so-called back-loading) may help correct the substantial oversupply of permits which have caused the carbon price to fall below 5 euros, a sixth of the price in 2008.

from The Great Debate:

A ‘Marshall Plan’ for Africa’s employment challenge

To Africa’s many challenges, add one more: unemployment.

Unemployment, independent of any other factor, threatens to derail the economic promise that Africa deserves. It’s a time bomb with no geographical boundaries: Economists expect Africa to create 54 million new jobs by 2020, but 122 million Africans will enter the labor force during that time frame. Adding to this shortfall are tens of millions currently unemployed or underemployed, making the human and economic consequences nearly too large to imagine.

Thus, even with the strong economic growth we have seen over the past decade, job creation in Africa remains much too slow. Africa needs a comprehensive, coordinated approach akin to America’s “Marshall Plan” in Europe after World War Two. That effort focused on building infrastructure, modernizing the business sector, and improving trade. By the end of the four-year program, Europe surpassed its pre-war economic output.

from The Great Debate:

Putin’s (un)happy new year

Russian President Vladimir Putin has bid farewell to 2013 with his state of the nation address, followed closely by his annual 4-plus-hour marathon news conference. He even managed to appear magnanimous, notably in his decision to pardon the imprisoned oligarch Mikhail Khodorkovksy.

He is setting the stage for the main event: the Sochi Olympics.

But as Putin subtly warned in his final 2013 appearances -- and as the Volgograd bombings so graphically confirmed -- major changes must come in the new year. Putin virtually admitted in his December speeches that the current path is not sustainable, while the Volgograd bombings have increased the urgency to face up to Russia’s problems.

from The Great Debate:

International pressure works on Putin

Russian President Vladimir Putin had expected the grandest of guests for the opening ceremony of the Winter Olympics in Sochi -- presidents, billionaires, the global big players.

For years he had imagined the presidential box like this: Needling President Barack Obama that NASA now depends on Russian rockets to get American astronauts into orbit. Emphasizing to French President Francois Hollande that France would be better served in the business world if it dropped all references to human rights. Making deals with the German delegation over champagne, as the ice skaters pirouette below, around the Olympic flame.

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