The World of Constants

Tyler Cowen, who writes the Marginal Revolution, lamented the headline that the French have decided to scrap the law which loosened the country's rules for hiring and firing employees but just for employees under 26. In the current world of employment laws in Europe, this one could have done one of two things - it could have improved however slightly the prospects for employment of people under 26 (which was its intended effect) or it could have decreased the bleak prospects of reducing the monumental levels of unemployment among that class of employees by decreasing their propensity to employ (remember there was no change in the various doles - which I thought was the more likely result). Regardless of the actual result, what the discussions and riots suggested to me was the deeper problem in most of Europe, which many of our friends on the left view as nirvana, which is a severely constrained labor market.

Look at GDP growth in Europe's powers in recent years and you can see clearly the effects of this or the idiotic additional constraints that might have been created as a result of last year's proposed European constitution which had a series of labor "rights" that would have enshrined this kind of nanny state in a permanent state. Yet the French leaders (and many of our own left of center commentators who think these kinds of systems are really heaven on earth) just don't get the underlying message. Thnk of commentators like Anthony (The Third Way) Giddens from the UK or Paul (The Great Unraveling) Krugman to see examples of this heady nonsense.

It is refreshing to wake up and to read that a group of writers/thinkers who you think just don't get it, still keep to their (1% GDP or less) ways in spite of overwhelming evidence. Too bad for their people. By the way Friday's US job report showed unemployment at 4.7% - Germany and France are more than twice that rate and then some.