Monday, 13 November 2017

Glyphosate mon amour !

Anyone who travels by train or car from Paris towards the Loire valley or Brittany will pass though the region of the Beauce, thousands and thousands of acres of flat, arable land that stretches for miles and could be described as France’s breadbasket. The farmers of wheat and other cereals who are lucky enough to have land in this area are among the wealthiest of their profession. A lot of their harvest is exported and contributes positively to France’s trade and current account balances.  These are definitely not the French farmers who sometimes use their tractors to disrupt traffic on major roads or dump tons of potatoes or manure in front of government buildings. One of the reasons for their success is the high yields enabled by the spraying of powerful herbicides and pesticides on their crops. The same is true for sugar beet farmers and, to a lesser extent, many others.

It has been known for some time that residues of these chemicals can be found in foodstuffs and urine samples. Environmental activists have long denounced their widespread use and beekeepers consider neonicotinoid pesticides in particular responsible for abnormally high bee mortality in recent years. Public debate has now crystallised around glyphosate, the chemical compound used in Monsanto’s famous herbicide, Roundup. As glyphosate’s licence for use throughout the European Union is due for renewal by December 15 of this year, the debate has become increasingly heated and no fewer than eight expert and ministerial meetings in Brussels have been unable to attain the necessary majority for renewal. The European Commission’s initial proposal was to renew the licence for ten years, reduced to five after an outcry from the European Parliament. France, through its Minister for Ecological Transition (and telenvironmentalist in a previous life) Nicolas Hulot, has refused to concede more than three years and is thought to favour the gradual phasing out of the product altogether rather than renewing the licence and facing the same battle three years hence.

Somewhat concealed under the manoeuvrings of the Commission, clearly influenced by Monsanto’s lobbying, the European Parliament which has banned the company’s representatives from entering its premises and environmentalists of all persuasions, the underlying issue is the future shape of the European Union’s model of agriculture. And as France is one of the EU’s largest countries and a major producer and exporter of agricultural produce, its stance will have a big impact. An additional twist to the plot is that the German chemical concern, Bayer, launched a takeover bid for Monsanto in September 2016, so the position of Germany, still embroiled in coalition negotiations to form the next government, is likely to tip the balance one way or the other.  

Like most people, I have no way of knowing what claims and counterclaims about glyphosate are accurate. A specialist body of the World Health Organisation has concluded from its studies that it is carcinogenic for humans. Other studies claim that it is not, although doubts have been cast on their design and conclusions. Common sense however would I think conclude that spraying large quantities of strong chemicals on crops of all kinds, even if they are not a direct cause of cancer, is not exactly conducive to good health. On holiday in Alsace a few years ago, I remember walking though some vineyards, seeing a large tank of liquid that was undoubtedly being sprayed on the vines and coming away with my eyes stinging so badly, that I had to go straight to the nearest pharmacy and ask for something to relieve the pain. The pharmacist made no comment on the reasons I gave for seeking his help, but with the help of an over-the-counter ocular formula my eyes were back to normal by the end of the evening. I couldn’t help wondering though whether the chemical sprayed on the vines, whatever it was, would not leave a residue in the grapes and the wine that would be made from them. Not too many months later, my ex-wife’s basset hound, a middle-aged dog normally in good health, died in obvious pain a few days after lapping from what looked like a puddle of rainwater at the edge of a cultivated field. The vet was unable, or perhaps unwilling, to say what he had died of, but my suspicion is that he had slurped up some nasty and poisonous chemical, washed off the crops by rain.

All in all, I can’t help feeling that environmental activists should be taken seriously when they call for a complete overhaul of France’s agricultural model. There are signs that farmers are starting to listen, under pressure mainly from consumers who are increasingly keen to buy organic produce (See: “Food glorious food”- September 18th).  In one of those schizophrenic episodes to which the EU authorities are prone, European subsidies are earmarked for farmers who convert to organic farming methods although, for the time being, reports suggest that they are insufficient in France and being paid out very slowly by the French government.  Personally I look forward to being able to eat bread and drink wine that is certified free of chemical residues – and too bad for wine growers in Alsace or wheat farmers in the Beauce. They are likely to protest loudly, lobby hard and do their best to procrastinate but I’m confident they won’t go out of business!

Wednesday, 8 November 2017

Pain and the night

There is a nasty undercurrent of frustration and violence in French society today. Everyday incidents of violence against people and property are often reported sparingly, if at all. It is only when some major outrage occurs that it captures the public imagination and media attention before sinking back into convenient oblivion.

The most recent to hit the media headlines was the trial that has just ended of a lone, home-grown terrorist, Mohamed Merah, who killed three French soldiers, all Muslims, and three Jewish children as well as the father of two of them, at a Jewish school in Toulouse in 2012. In fact it was not his trial at all, as he was shot dead by the police just days after his crime, but that of his family, particularly his elder brother, as well as a childhood friend. Both stood accused of complicity. They were defended by a leading Parisian lawyer and, given the cold-blooded nature of the killings and the police siege that ended the terrorist’s life, the media coverage was constant and comprehensive. The professional judges hearing the case concluded that the two defendants were not guilty of complicity in terrorist acts, for which they would have faced life imprisonment but only complicity in planning terrorist acts, for which the elder brother was sentenced to 20 years in prison and the friend, who provided the weapon of the crime, 14 years. The prosecution has appealed against the sentence on the grounds that it didn’t go far enough and the victims’ families were clearly distressed about what they considered to be the leniency of the verdict.

Over and above this brief outline of the case, what was striking throughout the trial was the evident hostility, if not downright hatred, of France and everything French on the part of the terrorist’s family. The verdict of complicity was clearly based on the fact that the young man himself, who had a record of petty crime but nothing worse at the time he went on his killing spree, had been radicalised and considered himself on a mission to kill infidels and Jews. Most of that radicalisation appears to have originated from within his family.

Of course it is only a very small minority of second and third generation youngsters from French Muslim families who are radicalised in this way, but the story of Mohamed Merah is surely not isolated either. Another report on the radio, that I heard only once, recalled that acts of anti-semitism have increased substantially in France in recent years. One out of every four attacks on people, it was reported, is carried out against Jews. Feeling increasingly threatened in their home country, more than 8,000 French Jews chose to emigrate to Israel last year, by far the highest number from any European country.

Even Halloween night, which has so far usually been synonymous with a good-natured outing for young kids in disguise, knocking on neighbours’ doors and calling out “trick or treat”, took on a more sinister turn this year, when it was reported, again very fleetingly, that dozens of cars had been torched in towns and cities all over France, and not just in blighted suburbs around Paris, Lyon and Marseille. This phenomenon has previously been a feature of New Year’s Eve only. Now it seems to have spread to Halloween.

These seemingly unconnected reports within two days would not have focused my attention so sharply had I not woken up on the morning of November 1st to find that a plastic chair had been taken from the next door garden and thrown over our sea wall, and that a gate at the end of a path that runs into the village had been broken from its hinges and was missing. Nothing more than misguided youthful spirits fuelled by a little too much alcohol, one might argue. I must admit that I’m not so sure. Without overstraining the link between terrorism, the gratuitous torching of cars and an attempt to destroy property in a quiet seaside village, is it not the case that natural youthful spirits and adolescent spleen, if not reined in and sanctioned by family or community or the authorities when it goes too far, can lead on to petty crime and sometimes worse? Add in the ingredients of the dreary life on council estates, failure at school and dim employment prospects and the mixture can become highly combustible, receptive to malevolent influences.

In France, a country that prides itself on striving to build an inclusive society, there are clearly too many young people, particularly from immigrant communities, who feel excluded and alienated. Turning these sentiments around will be a long and difficult task but it is surely better to start by facing them head on rather than sweeping them under the carpet.

The French popular singer, Renaud, best known for catchy tunes and sentimental love songs, tinged with mild social criticism, wrote and performed a song called “Deuxième Génération” (Second Generation) as long ago as 1986. It is certainly not one of his best-known songs and has never been given much airtime. Maybe it is simply too close to the bone for those who seek to influence our tastes and opinions. Judge for yourself by listening, particularly to the refrain, if you understand French. If not, you will have to make do with my own, inadequate, translation.

My name’s Sliman and I’m fifteen
I live with my folks in a run down flat
I’m already a graduate of crime
I’m no slouch, I’ve had more than one spat
But I’m the strongest in my gang,

A snakehead on my arm proves that.

(Refrain) I’ve nothing to gain, nothing to lose,

Not even life,
Only death lights up my dreary days,
I like only things that are shredded with a knife,
But what I like most is what gives you fright -
- Pain and the night.

And with the benefit of hindsight, what could be more prophetic than the last verse, in which Sliman identifies with fellow-sufferers in a distant land and wishes he could march off to fight with them?

To feel I belong somewhere
To a people and a land
I wrap around my hair
A keffieh in grey, white and black
And imagine us as brothers,
Stabbed together in the back.

Wednesday, 18 October 2017

Macron through the media spyglass

Having studiously avoided the kind of chumminess with journalists in which his two predecessors indulged with gusto, it could only be a matter of time before President Macron submitted himself to a set piece interview on prime time television as he did on Sunday night. Having watched it from beginning to end, my overriding impression was that neither Macron nor the media have changed much since the election in May.

Although the three journalists who questioned the President are among the most respected in their profession, none escaped the temptation of picking on the trivia of Macron’s first months in power. The tough language that he sometimes uses, we are told by the media and opinion polls, is what French people are most interested in.  His words however are often taken out of context. In a recent speech to the French expatriate community in Athens, for example, the President said:  “I am absolutely determined (to defend democracy and peace in Europe) and I shall yield nothing to cynics, slackers or extremists.” (“Je serai d'une détermination absolue et je ne cèderai rien ni aux fainéants,ni aux cyniques, ni aux extremes”). Although he was not referring directly to the reforms underway in France, the words, quoted out of context, were taken by the media to refer to his opponents, particularly the unions. More directly, in an unguarded moment during a recent visit to a centre for apprentices, Macron said that former employees of a doomed factory who were demonstrating outside, should “go out and look for work rather than stir up trouble” (a milder version of the colourful French expression: “foutre le bordel”) Lumping these two totally different utterances together, the journalists were eager to know whether he was intending to be insulting. Did he understand that many French people apparently did feel insulted or humiliated?  Macron remained calm, countered that he was not afraid of saying what he meant nor of expressing his thoughts forcibly. He made no apologies, apart from saying that he had the greatest respect for the French people.

Was he the President of the rich then, as many in the media and the opposition have tried to make out, after the announced emasculation of the wealth tax, now being debated in parliament? No, Macron said, he was not. The French would do well, he continued, to stop being jealous of success, financial or otherwise, that he preferred to see successful French entrepreneurs remain in the country, invest their wealth and create jobs rather than leave for more temperate tax jurisdictions, as many have already done. The facts would appear to bear him out. And, as some commentators have pointed out, the wealth tax, even in its best years, was largely symbolic anyway. By proposing to exclude financial assets from it, as well as introducing a 30% flat tax on all financial income, France is only returning to a level of taxation that prevailed before the big increases introduced by the previous administration. Macron, it would appear, is willing to invest some of his own political capital in telling the unvarnished truth, in an attempt perhaps to puncture some of the country’s more toxic myths and symbols. For even without a fully-fledged wealth tax, France is still, and will probably remain, one of the countries with the highest overall levels of taxation in the EU, itself an area of high taxation compared to the rest of the world.

On Monday the media were telling us that Macron had not convinced a majority of viewers about his reforms. That being said, five months into his presidency, he said very little that he had not said before: give a larger degree of freedom to successful individuals and businesses that create wealth and jobs, while targeting those who need most support and protecting the weakest and most vulnerable in society.  Against the background of an extremely complex and multifaceted system of social safety nets, many details of course have yet to be worked out. Some of them are only now starting to take shape and Macron briefly sketched them out:  upgrading the status of apprenticeships and increasing the number of apprentices; giving serious vocational training to those most in need of it, the under-qualified and long-term unemployed, very often the same people, rather than sprinkling resources over a variety of largely cosmetic short-term training courses; building more social housing by forcing social housing offices to stop hoarding the comfortable surpluses that some have accumulated and use them instead to build more housing units and lower rents, rather than supporting the upward spiral of rents by continuing to hand out large subsidies to tenants.

In all this, Macron continues to show “both a single mindedness and an inner solemnity” that Sophie Pedder aptly described in her recent special report on France for “The Economist” (September 30th). Macron was solemn, as he always has been, in his view of his mission to bring about a profound transformation of the country and his resolve not be put off by the current dip in his popularity ratings. Single-minded too in his oft-repeated mantra that people rather than jobs should to be protected and that they must be made fit to compete in a global economy that is changing a lot faster than old Europe in general and France in particular.

Questioned about how long it would take for this vision and its associated policies to produce visible results  (and not just a fall in unemployment, the yardstick by which François Hollande chose, unwisely, to be judged) he answered that it would take at least 18 months to two years.  

On the basis of Sunday’s interview therefore, it seems fairly safe to assume that Macron will continue to pursue his single-minded path and that, for the time being at least, the media will continue to see things through the small end of their spyglass.  One can only hope that within two years both will start to see the emergence of a bigger picture.

Tuesday, 10 October 2017

"The French are always on strike!"

This morning on the BBC’s “Today” programme, that I listen to over breakfast, the veteran interviewer, John Humphrys, was asking a British economist why productivity in the U.K is so much lower than in many other countries. The economist pointed out that hourly productivity in France, for instance, is much higher, "because the French work harder when they are at work, even if they have a shorter working week and take longer holidays." To which Humprhys countered, only half jokingly, "but the French are always on strike, aren’t they?"

Well, as it happens, today they are. Or at least those who work in public services. This being said, public transport seems to be running more or less normally, hospitals will not be much disrupted and only schools and government offices seem to have closed down completely for the day. A number of street marches are planned throughout the country.

At first blush then, true to form. A closer look however, reveals a number of seemingly minor but interesting developments. First of all, the unions, traditionally strong in France’s generously dimensioned public sector, are not united in their protests today, as they so often have been in the past. The leaders of the three main unions will be marching separately in different parts of the country. One union leader has even gone on record as saying that street demonstrations are not perhaps the most effective form of union action. Secondly, as "The Economist’s" Charlemagne pointed out a few weeks ago ("Exorcising French demons"– "The Economist"  - September 9th), the rounds of intense discussion between union bosses and ministers during the summer holidays to prepare the labour market reforms that are now being implemented seem to have toned down, at the very least, the climate of confrontation that has so often characterised relations between unions and the government, as well as between labour and management in general. If all sides were now starting to realise that talking to each other far from the media spotlight is, after all, a better way of proceeding than carefully crafted one-liners destined for prime-time news or a show of force on the streets?

It’s early days yet of course, but there are other interesting signs that indeed, the climate may be changing. I was surprised for instance to hear this morning on France Info, the 24hr. news and current affairs station of the state broadcaster Radio France, the views of Laurent Bigorgne an economist at the head of a think-tank called the Institut Montaigne, renowned for its economically liberal views and often a mouthpiece for France’s business elite with a social conscience. It was unusual to hear its director general being interviewed on a radio station that generally bends over backwards not to rock the boat. It was even more unusual to hear him state a few home truths about public service workers that one hardly ever hears on the mainstream media. Why are salaries often lower in the public than in the private sector, the politically correct interviewer asked?  The answer, Bigorgne said, although the unions would never admit it, is that a deliberate choice has always been made to favour employment over pay, especially as one way of increasing it, namely salary increases and advancement based on merit, has always been taboo. He went on to say that, in any case, salaries are not the real problem in the public services. They suffer above all from a lack of proper management. Ask any public service worker in the street what they dislike most, he continued, and the chances are they will tell you that they have no clear idea of where their job fits into the general scheme of things and that it makes little difference whether they strive to do a good job or not. They would probably be much happier, he concluded, if they were properly managed.

I don’t think I am the only one who has rarely heard this kind of language before in the mainstream media. It reminds me not only of some of the cobweb-clearing statements by Emmanuel Macron, on whom Bigorgne is said to exert some degree of intellectual influence, during his presidential campaign but also of a conversation I had, long before Macron became a household name, with a leading executive of a large French listed company. He told me that he had started his career in the public sector but quickly became disenchanted when he realised that his ability to get things done was severely constrained by the lack of any real management culture, particularly in human resources.

For the moment, such sentiments are certainly not in the mainstream and little more than straws in the wind, but I suspect they go deeper than current political correctness would suggest.  If, however, they were to herald a gradual cultural shift about what the state should do and how best it can do it, they would indeed usher in profound changes to traditional French attitudes towards its public services. French people in general demand high levels of public service, lament their deterioration, in some areas even, their slow decay and applaud the generally high public service ethic of most civil servants. They would never accept, for instance, the kind of root and branch overhaul of the civil service that took place in the U.K under Margaret Thatcher or in countries like Canada, Sweden or Switzerland. If however the view started to prevail, particularly among those most directly concerned, that public services can be considerably improved by greater efficiency and better management and not just by more investment and higher salaries, then France would have embarked on a real path of reform that would surprise even the most die-hard believers in the myth that “the French are always on strike!” 

Sunday, 24 September 2017

The centre holds

It is now almost four months since Emmanuel Macron was elected President of France. On Friday of last week he signed the executive orders reforming the French labour code that he promised during his campaign and that his government has been preparing all summer. The opposition parties are still struggling to find their feet after their defeat at the presidential and parliamentary elections and events of the past week have only made their divisions more visible.

This Sunday, September 24th, as Germany goes to the polls to elect its new parliament, it is worth noting that the French government under Edouard Philippe, unusually for France, looks a lot like Angela Merkel’s grand coalition that has governed Germany for the past four years.  After splitting both the traditional left and right-wing parties and bringing together the moderates of both, Emmanuel Macron is governing from the centre in much the same way.

For the moment, the forces opposed to him are still reeling from their defeat in the elections. The Parti Socialiste, after failing miserably to make the run-off in the presidential election and losing a considerable number of MPs in the parliamentary elections, has been reduced to putting its now oversized headquarters up for sale and is ruled by a 16-person committee. It has said nothing of note about labour market reform. On the radical left, Jean-Luc Mélenchon has styled himself as the only real opposition to Macron and has been attracting media attention by gimmicky tactics in parliament and outlandish statements to the party faithful. Just four months after a hotly contested set of democratic elections, he rallied supporters in a street demonstration in Paris on Saturday and claimed, in all seriousness, that true democracy was only expressed in the street because if was protestors in the streets who had toppled the Kings of France and the Nazis! Until he can find something more credible to say, he is unlikely to mobilise many voters beyond his hard core of unquestioning supporters.

The Front National, that could have been expected to form an opposition from the far right, is also in disarray, unsure of if its future path and leadership and riven by ideological divisions. Florian Philippot, its number 2 until the end of last week and the architect of the party’s newly won respectability, but also its ill fated “ditch the Euro” platform at the presidential election, announced his departure from the party on Friday after being stripped of his powers as vice-president. A lot of the party’s rank and file was never happy with the ideological shift that he persuaded Marine le Pen to adopt and wants to revert to its former focus on identity and immigration. The fact that Philippot is gay never endeared him to many party activists either, whose xenophobic, homophobic and anti-elitist leanings were naturally antagonistic to a gay, ENA-educated and media-savvy vice-president.  Many activists and voters would like nothing more than for Marine Le Pen’s niece, Marion Maréchal le Pen, to lead the party into the next elections. However, having announced just three months ago that she is leaving politics altogether, it is doubtful she will oblige, at least not yet. This being said, Marine Le Pen’s disastrous performance in the run-off presidential debate in May still rankles and has surely compromised her chances of contesting the next presidential election in 2022, especially if Emmanuel Macron stands for a second term.

Which leaves the rest of the right-wing opposition of “Les Républicains”. Now that three of its leading members are pillars of the government, the party is in the throes of redefining itself and seems to have split three ways.  Some members have formed what they call a “constructive” wing, offering qualified support for the government’s reform programme. Others have formed up behind Valérie Pécresse, current President of the Ile-de-France regional council and call themselves “Free” (Libres). It is not yet clear how they wish to differentiate themselves from the other parts of their party. The more hard-line members consider that only a resolutely right-wing opposition party can be a credible alternative to government.  Their standard bearer is Laurent Wauquiez, who passes for a disciple of Nicolas Sarkozy and who is likely to be elected to lead the party at their forthcoming congress in December. It will be interesting to see what the party’s attitude will be to those of its members who are now government ministers.

Whether this clarification, when it comes, will lead to greater permeability between Les Républicains and the Front National remains to be seen, and ultimately of course, it is voters who will decide. But as the next national elections are not until 2019 and 2020, there will be a lot of manoeuvring between now and then, starting with the parliamentary debates on next year’s budget in October.  

For the moment though, it looks as if Macron and Philippe have a firm hold on the centre ground, both in government and in parliament, with opposition from all sides either muted or lacking credibility.  Notwithstanding Mélenchon’s more outrageous statements, there will surely be challenges in the streets to the forthcoming announced reforms of unemployment insurance and vocational training, not to speak of the highly contentious issue of pensions. All three could be explosive. As often happens in France, a spark from an unexpected quarter could ignite huge popular protests. The government is said to fear more than anything demonstrations by university and high-school students or protesting lorry drivers blocking the country's roads and motorways. Macron’s future - and the future path of France - will depend crucially on whether he can exploit the window of opportunity that has opened up before him and demonstrate the necessary political skills to coax through the reforms on which he has staked his reputation.

Monday, 18 September 2017

Food, glorious food ! (1)

France has long and rich gastronomic traditions that are deservedly admired all over the world. Food is one of the country’s favourite topics of conversation and, on all possible occasions, people delight in swapping tips about food shops and restaurants, not to speak of wines. Foreigners often find it hard to understand why so many French people have scarcely finished one meal when they start planning the next. In the French language, many metaphorical expressions have food or wine as their theme. General de Gaulle, who had a reputation for colourful turns of phrase, once expressed a sense of exasperation with the French by exclaiming: “how can you possibly govern a country that has 258 varieties of cheese?" (“Comment voulez vous governer un pays où il existe 258 variétés de fromage?”)

Given this deeply entrenched food and eating culture, it is sad indeed that the French, above all peoples, seem to have become so readily accustomed to the mediocre produce they now find in most of their shops and supermarkets.

When was the last time any reader can remember eating a tomato, an apple or chicken that tasted like a tomato, an apple or chicken?  Not to speak of strawberries, now routinely sold out of season, that often taste no better than cardboard soaked in water. The answer is probably many years ago, unless of course you grow your own fruit and vegetables and keep hens in your back garden. But most people no longer have the space, the time or the inclination to do so. Perhaps also, French taste buds have been slowly numbed by having so few alternatives to bland and mediocre fare. It is only when one visits a deserted corner of rural France or a less developed country, in Asia for instance, that one fully realises how much taste has been lost over the years.

The underlying reasons for all this have been well rehearsed: In the space of just three or four generations, France has gone from being a largely rural, agricultural country to a constellation of large cities and built-up areas with big, almost abandoned spaces between them. Large retails chains like Auchan, Carrefour, not so long ago the world’s 2nd largest retailer and the more home-based Leclerc, have grown fast by serving large concentrations of population with large stores and fierce competition on prices. According to INSEE, the national statistics office, the average household spent 35% of its budget on food in 1960 but that figure has now shrunk to 20%, a quarter of which is spent outside the home. Of course, the general increase in living standards goes some way to explaining this, but there are also the attendant changes in life styles, with more two-adult households going out to work and children eating lunch at school. In parallel, agriculture in all its forms has become an industry and quantity has largely replaced quality. In all this, France has typically, some would say tragically, followed the same trend that has been apparent in the U.S for decades.

Even that time-honoured myth about France's two-hour lunches has faded. In French cities today, despite the willingness of some to perpetuate the myth by taking clients or foreign guests to a top-class restaurant, most employees are only allowed an hour’s break from their work and many are content to eat a baguette sandwich or a McDonalds cheeseburger. In the evening, after a long trek home in overcrowded buses or trains or through endless traffic jams, there is little energy left to do much more than heat up a ready-to-eat meal out of the freezer or fry fish fingers accompanied by pasta or rice, finishing off with a milk based, over-sweetened desert in a plastic container. Picard, a chain of frozen food stores, is now strategically placed in most high streets but its convenient and attractive-looking offerings turn out, more often than not, to be bland and devoid of real taste. Supermarket shelves overflow with sweet deserts of all kinds.

The food industrialists have not been slow to jump on the organic food bandwagon to try and persuade the French that they cannot only eat better but also more healthily. And, by and large, French consumers have fallen for it. In the town in which I live in the western suburbs of Paris, there are now no less than four organic food shops within a mile of each other, three of them belonging to national retail chains and the fourth a small shopkeeper. Having tasted their fresh produce, I must honestly report that I am not convinced of the need to pay more for apples or carrots that may have been grown without herbicides or pesticides but which do not taste perceptibly better. And some of their best ideas like cereals, nuts and dried vegetables available in bulk have been largely copied in the normal supermarkets. I wonder which one of the four will go out of business first  - and which will survive when the organic bubble bursts.

In a word, food in France has been largely commoditised, in the same way that so many other goods and services have been, and commoditisation is having the same impact it has had on other industries. There will continue to be a mass market served by large retail chains charging the lowest prices they can without going out of business. To remain competitive, they will continue to squeeze every possible cost, from staff to transport to produce. But for a smaller number of more discerning consumers, perhaps more in France than in other European countries, who are willing to pay much higher prices for much tastier produce, there will be up-market specialist shops or market traders who either grow their own produce or source from carefully chosen suppliers. The losers will be the shops, supermarkets and traders with no discernible advantage in terms of price or quality.

I suspect that this fate is already befalling Carrefour, which used to be one of France’s most successful retailers, as well as an exporter of French food and retail know-how to the rest of the world, but is now struggling to reinvent itself. But that will be the subject of a future post.

(1)  The title of a song from Lionel Bart’s musical “Oliver”, based on Charles Dickens’ novel “Oliver Twist”.

Monday, 11 September 2017

Amazon in France:a love-hate relationship!

In just a few years, the Internet giants that even French journalists now call “les GAFA”, have made as profound an impact on everyday life in France as in most other countries. In doing so, as perfect examples of digital-driven globalisation, they have generated highly ambivalent attitudes among consumers. Quite often, the same people who engage with them intensely on their desktops or smartphones on Saturday, will vote for avowed anti-globalisation parties on an election Sunday. This ambivalence became clearer to me through two recent chance encounters.

The small Breton seaside village in which I have spent most of my summer holidays for the past 40 years has a population of about 500 for most of the year that swells to more than 10,000 during the peak tourist season. Thanks largely to the income from tourism, the village can support a small supermarket, a doctor’s surgery, a pharmacy and, somewhat surprisingly perhaps, a small bookshop selling books, maps, postcards and the like. They all manage to stay open throughout the year. This in turn means that the village is still a reasonably balanced community with people of all ages, including enough young children to justify a small primary school. It has thus escaped the fate that has befallen so many small villages in France that do not have the attraction of long sandy beaches and boat trips round the islands.

Although, like many people in France, I buy most of my books these days on-line and read them increasingly on a Kindle or similar device, I always make a point, to salve my conscience perhaps, of buying my summer holiday postcards from the bookshop in the village. I was in there doing just that this summer when another customer came in and asked for a book that the bookseller told him was out of print. He said he would try and find it through his “own network”, as he put it. Oblivious for a moment to the thin ice I was about to fall through, I ventured that it might perhaps be found on Amazon or the Amazon market place. This caused the bookseller, normally an affable and mild- mannered man, to launch into a long and blistering attack on the Amazon “bandits” who pay no taxes in France and who even manage to have their VAT refunded! The survival of his shop in the village, he went on, was due mainly to the fact that, under French law, all new books are sold at one and the same retail price regardless of their distribution channel, as well as to the presence of the supermarket, the primary school and the pharmacy next door. If it weren’t for all that, he concluded, he would have to close down his shop as there was no way it could survive by being open only during the summer.

Many politicians of course, and not just on the extremist fringes, have had a field day exploiting such sentiments and the popular media are quick to relay the complaints of “hard-working over-taxed small shopkeepers” confronted with the “freeloading Internet giants” like Amazon.  You have to go to the more serious media to find out that, at the instigation of governments confronted with the same phenomenon throughout the EU, the European Commission, among others, is working hard do something about what it calls “aggressive tax planning”. It is indeed abundantly clear that the GAFA, together with many other multinational corporations, have devised sophisticated tax optimisation strategies to avoid having to pay high rates of corporate income tax in relation to their actual sales and profits in a particular country. One article I read showed a detailed diagram tracing the multiple financial flows between national subsidiaries towards holding companies in Luxembourg, the British Virgin Islands and the State of Delaware, where corporate income tax can be minimised. As an example of one of the many and various national, EU and OECD initiatives that are currently on the drawing board, the European Commission is working on a “CCCTB (common consolidated corporate tax base) directive”. If adopted and implemented, this directive would oblige the GAFA to consolidate their revenue from all countries in the EU and pay an agreed level of tax that would be apportioned to the member states on the basis of the revenue generated in each one.

Whether the CCCTB directive, if and when it eventually comes into force, will make the position of my village bookseller any more secure is a moot point. But it would in theory put him on an equal footing with Amazon in selling books, and maybe, all other things being equal, ensure the continued presence of his bookshop in the village. That being said, as Internet becomes more and more prevalent, consumers clearly find it more convenient to buy books, as well as many other items, on-line, as the large number of other on-line booksellers testifies, not to speak of Amazon’s smothering embrace of many other retail markets.  But Amazon will probably continue to be a convenient popular scapegoat for the inevitable ills of globalisation.

But there is of course, as always, another side to the story. It makes fewer breathless headlines but will probably have an equally lasting impact. It concerns the investments made and the jobs created by the Internet giants. The GAFA have made substantial investments in France, in European or national headquarters, flagship stores, research laboratories and, as far as Amazon is concerned, logistics centres.  Over the last ten years or so, it has built four large logistics centres in France. It is building a fifth in the north of the country, an area hit by industrial decline and high unemployment, and has just announced its intention to build a sixth in the Paris area. To date, it has created about 5000 jobs.  Naturally enough, it has been encouraged to do so by generous public investment subsidies, including one of over €1 million for the building of a giant warehouse in a part of rural France where the former “minister of productive investment”, Arnaud Montebourg, used to be an MP. During his ministerial tenure, he was mainly known for his “buy French” campaigns and occasional violent criticism of globalisation. In this case, he clearly used his ministerial powers of persuasion to help the local authorities clinch a deal with Amazon.

Nor is it entirely accurate to accuse Amazon of paying no taxes at all in France. Like any business, it pays local property and business taxes and, more importantly, contributes through compulsory payroll levies to the health care and pension provision of all its French employees. One of them is a young woman I was sitting next to on a plane last year. Definitely a member of the Y generation and a child of globalisation, she was on her way to Tokyo to take up her first job as a junior manager for a French logistics company operating in Japan. A few days after my conversation in the bookshop, I found out, through LinkedIn, that she has now returned to France and taken up a position as area manager at one of Amazon’s largest logistics centres in France.  She is no doubt happy to have a good job doing what she trained to do in school.

Whether her story will be of comfort to the village bookseller in Brittany is a matter of some doubt. She, after all, is a winner from globalisation whereas he is a potential loser. I nevertheless hope that I shall still be able to buy my postcards in his shop for a few summers to come.