Chances are alas higher that France is the future of America than the contrary. Hence, even an American should not disregard this post. The featured image shows a big pile of uncollected garbage on boulevard Saint-Michel, in Paris, on Thursday. Many garbage collectors, already assured of a generous state-paid pension at 62, are on strike to protest the increase of the retirement age to 64. Unknown to them is that they may have to retire even later if the bankrupt state pension system is not mended by even deeper reforms.
The author of the attempted reform is the centrist president Emmanuel Macron. The political center in France is about where Joe Biden stands on the standard political spectrum in America. The center moves toward where the most political powerful extreme pulls. I will grant that Macron, a former banker, does not match either Biden nor Trump in economic ignorance. As the French Civil Code maxim goes, “À l’impossible nul n’est tenu,” from the Latin Impossibilium nulla obligatio est, which translates into “the impossible is no legal obligation.” Macron knows that assets below liabilities necessarily implies that the remainder, the owners’ net value (the future retirees’ pension value, in this case), is negative.
Two-thirds of French voters are opposed to the reform, that is, they want more of their pensions to be paid by the other third; or they don’t have a clue. Macron realizes this but argues, quite sensibly, that the majority would not want any of the alternatives either, such as higher current or future taxes, lower economic growth, or a more dramatic crash of the pension system along perhaps with general prosperity (see “Macron Government Bypasses France’s National Assembly to Pass Pension Overhaul,” Wall Street Journal, March 16, 2023—especially the accompanying video for Macron’s words).
The problem of Social Security in America is only less massive than in France. In both countries, the inability of “democratic” choices to deal with the problem is the same.
Such is the failure of “democracy” as we know it. Instead of a procedure for changing the rulers without violence or civil war and thus hopefully to constraining their self-interest and folly, democracy is viewed as a system in which the majority can “legitimately” decide anything it wants and impose its desires and greed on the minority. (See my forthcoming Econlib review of Friedrich Hayek’s The Political Order of a Free People.) This sort of political philosophy ignores the discovery of the Public Choice school of economics which has studied phenomena such as the incoherence of unconstrained majoritarian choices, the rational ignorance of the individual voter, and the triumph of organized interests which manipulate puppet politicians and voters. A mob is seldom, if ever, libertarian.
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Author: Pierre Lemieux
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