Aug 21
Economists pass the test of Bac
Marc Touati, Associate Director of Global Equities
This topic is more socially and economically. In the current crisis, it is even very controversial, very "dangerous". We must therefore take tweezers in the formulation of the analysis to avoid offending the spell …
I. The model of solidarity to the French: the world's best
Originally the solidarity model, also called French social model may appear as the best in the world. Its basic principle is: high public spending and high tax burdens, but in exchange, through redistribution, greater solidarity and hence less inequality, less unemployment, less poverty and more comfort- be economic.
II.This model of solidarity no longer works
Unfortunately, the past ten years, this model is disintegrating, to the extent that public expenditures increase more and more (56% of French GDP in 2009), the tax burden is among the highest in the world. Despite this extravagant strategy, growth, structural decline, unemployment is around 10% sustainable, poverty rate increases (14% of French people living below the poverty line), including the widening inequalities in income and health and funding of the retirement pay is more assured. So the French model of solidarity is more effective.
Conclusion: This is where the controversy settled: that it must also increase public spending and taxes. If this solution is certainly easier, it is not credible: it no longer works for 20 years and is a runaway.We must therefore stop veiling the face: the only way to make solidarity in France resides in the ability of the latter to the high growth. To achieve this, we must reduce the tax burden for all, make it as fairer, while lowering the inefficient public spending, including operating expenses.
Jean Paul Betbeze, director of studies of the Credit Agricole
Introduction: The word solidarity is one of the most important part of our vocabulary, one of the most sensitive too, because it is at the crossroads between economic and social. He asked how "to society", that is to say, how to combine growth, efficiency, distribution, justice. The issue of solidarity is today more acute because the growth is not at the rendezvous.This leads to the question of wealth distribution, with the idea that certain expenses so-called solidarity have been too high and / or have not contributed to growth, as might have been expected.
I. The French social model, an exception
Solidarity meeting in fact a set of situations. Shock people (health, illness), economic shock (unemployment and social benefits) and shock (pensions) are the three sources of spending solidarity. We must study their rationale, their legitimacy and effectiveness. Looking in effect say that young people can not but be struck by the solidarity they restricted themselves to considering. The family, themselves and their friends and cronies.This sends the idea, positively, that the best solidarity begins at home and his family, but also that state support, social activities are increasingly counted in the first place the conditions for retirement and old age support . Truth and realism.
II. There can be no solidarity without growth
So we must find ways to live together solidarity and growth, after some excesses were committed and at the inability to continue as before. There can be no solidarity without legitimacy, without transparency, without verification. That is no explanation for it, without penalty to the excesses or misrepresentation and without education, to avoid any shocks. Economic solidarity corresponds to the current difficulties of the job. Unemployment is the brand.But support to individual entrepreneurs (with tax benefits) are also a de facto solidarity. Finally, solidarity must be proactive. It must be less than a correction, compensation of a preparation: training throughout life support mobility. Solidarity in the event of sickness is also essential, but it can not avoid the growing support in people themselves. Lifestyle, sport, medical conditions are independent of a reduction of medical risk and provide a happier old age, longer and less dependent on solidarity.
Conclusion: Overall, we must squarely address the solidarity at the intersection of economics and welfare, by making clearer the economy (transparency, fairness, efficiency), the general benefit of society.
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