From December 5, 2019, a large-scale strike protest broke out in France. Some employees of the railway and bus departments and teachers and other public officials went on strike and took to the streets to demonstrate. Protests paralyzed public transportation in big cities, such as Paris, and prevented normal rail transportation across the country. Many primary and secondary schools were forced to close their doors and suspend classes. The activity continued intermittently for several days, and as of December 24, there was no sign of complete cessation. Statistics from the French Ministry of the Interior show that at least 800,000 people participated in the strike, which is not inferior to the previous “yellow vest” movement.
Since the second half of 2018, French society has entered a “eventful autumn”, and the “yellow vest” movement continued for several months, until the first half of 2019 gradually weakened. So is this wave of social storm a continuation of the “yellow vest” movement? How will the French government respond?
Not the new “yellow vest” campaign
In fact, this wave of protests has nothing to do with the “Yellow Vest” movement. It is different from the former in terms of causes, participants and organizational methods. The cause of this wave of protests was the protest against the “retirement system reform” being promoted by Macron’s government; the “yellow vest” movement was caused by the government’s increase in fuel prices and mixed with public dissatisfaction with other aspects of the government. . This round of demonstrations was carefully organized by several major trade unions and has leadership. The “yellow vest” movement was organized by the public through social media. When the government wanted to talk, it could not even find the target of negotiations. Although this protest was fierce, the protest crowd did not have the wide and complex source of the “yellow vest” movement, but concentrated on a specific group-the “offenders” of the reform and the “yellow vest” Compared with the movement, the main body of the protest crowd is more clear. However, as the protests continue, more and more people are participating in the protests.
So why did the reform of the retirement system cause uproar? To this end, it is necessary to sort out the history of the establishment and evolution of the French retirement system.
The current retirement system in France was established after the Second World War. At that time, the government planned to establish a retirement system that covered all citizens without discrimination-unified payment, unified treatment, and unified management. However, some professional groups have had their own retirement systems before. For example, as early as the mid-19th century, the state established a pension system for public officials for their loyalty and integrity; in the industrialization process, they acted as “pioneers”. For the purpose of stabilizing the group of employees, the energy and transportation departments of each of them established their own retirement systems (at that time, these industries were difficult to recruit and retain labor due to factors such as high labor intensity, high risks, and difficult conditions). In summary, prior to World War II, France already had a number of industry-based retirement systems, which were generally better treated than the new systems under construction. Therefore, when the current retirement system was established, the relevant groups fiercely resisted the new system. In the end, the French government made concessions to allow these systems and their welfare privileges to be retained, and named them “special systems” and correspondingly named “general systems”. The new system, while the “general system” was compressed to cover only the private sector.
Since the mid-1970s, affected by factors such as population aging, declining birthrate, and continued economic downturn, France’s retirement system has gradually led to financial deficits and huge deficits. In order to ensure the sustainability of the system, in 1993 France began to reform the retirement system with the goal of increasing revenue and reducing expenditure. However, at that time, because the “special system” had more welfare privileges and huge resistance to reform, this round of reforms only targeted the “general system.” In 1995, the government wanted to carry out reforms aimed at “special systems”, which led to large-scale protests and reforms, and abortion. Prime Minister Zhu Pei was forced to step down. Only in 2003, under the pressure of European integration, the relevant reforms were restarted, and several rounds were carried out.
In general, after several rounds of reform, the “special system” still generally retains privileges such as short payment time, good retirement benefits, and early retirement age. For example, the “general system” retires at the age of 62, and under the “special system” many people can retire at the age of 55 or even 50. For example, statistics show that the average pension in France is 1,400 euros per month, but the national civil servants are 2,200 euros, the national railway employees are 2,636 euros, and the Paris transportation company is 3,705 euros. This shows that France has serious inequality in the field of retirement, which is also the main entry point for Macron’s reform of the retirement system.
Macron’s key word for this round of reform of the retirement system is “unification and fairness”, which is mainly to merge the “multi-track” retirement system into a “one-track” to weaken the welfare privileges of the “special system”. He said, “What we want to re-examine is the unfairness of the fragmented system.” We need to build a “much more transparent and fair” system in ten years through “flexible” and “very progressive” reforms.
Financial considerations behind the fairness of the retirement system
Although Macron claims that the main motivation for the reform is to improve the fairness of the retirement system, there are undoubtedly considerations to reduce retirement spending and ensure that the retirement system is financially sustainable. As mentioned earlier, the current financial pressure on France’s retirement system is huge, especially with regard to “special systems”. Affected by technological progress and industrial structure transformation, the proportion of the working and retired population under these systems has become increasingly imbalanced, and coupled with the high level of pensions, it has “strained” the entire system. A report issued by the French government in 2014 pointed out that the retirement system must be continuously reformed, or even under the ideal situation of a significant decline in unemployment and a marked increase in economic growth, the current system can only be maintained for a maximum of 15 years. So Macron intends to start by consolidating multiple retirement systems into one, weakening or even canceling “special systems”, thereby reducing expenditures.
It is worth mentioning that Macron’s reform of the retirement system is not only aimed at “special systems”, but also introduced reforms such as a points system, postponing the age of receiving full pensions, and encouraging retirement. It goes without saying that the purpose of these measures is to increase revenue and reduce expenditure. More deeply, these reform measures will also weaken the redistributive nature of the current system and the government’s responsibility in the field of old-age care, and move towards strengthening personal responsibility.
Since Macron took office, in order to solve the problems that have long plagued France’s labor market rigidity, stagnation in economic development, and high unemployment, he has introduced a series of reform measures with a bright economic liberalism aimed at unbundling and activating labor markets. While promoting economic growth, it also brought a certain degree of negative impact on the lives of ordinary people. This round of reforms also followed a similar line of thinking and was opposed by public servants such as teachers and beneficiary groups under the “special system” such as transportation. It was unexpected, after all, it first moved their “cheese”. However, the reform has also been widely opposed by the public due to measures such as points system and postponement. Faced with these reform measures, the mindset of ordinary people is quite contradictory. On the one hand, they support the abolition of “welfare privileges”; on the other hand, they do not support measures that damage the interests of ordinary people, such as the points system and the encouragement of retirement. French people generally regard Macron as a representative of “elite elements” who only focus on growth and ignore fairness, criticizing him for ignoring the interests of civilians.
In fact, France’s retirement system has always been dominated by state responsibility, and has been sought after by some countries for a long time in terms of preventing poverty, reducing poverty and ensuring fairness. However, it is also this system that has brought a huge fiscal deficit to France. Its unsustainable problems are much more serious than those of other countries and have been criticized by the EU for its name. In addition, the legal retirement age in France and the age for receiving full pensions are also low in European countries. Therefore, it is necessary to carry out the reform of the retirement system in consideration of the long-term interests of the French country. How to obtain the public’s understanding and support for the reform, taking into account efficiency and fairness, tests Macron’s political wisdom. On December 21st, Macron stated that he himself has decided to abandon the special presidential pension granted by law after the end of his term, and the president’s pension will be included in the country’s unified retirement system points system in the future. This move undoubtedly expressed the determination to “start with me” and push the reform to the end. It also showed that Macron would not give up reform, but he would seek a certain degree of compromise in exchange for the public’s release of reform.