Oct 26, 2005

"Europe's superior healthcare" [LINK]

My latest letter:

Defending the French health care system, Lisa Spencer admits that the unemployment rate in France is correspondingly high, hovering around 10 percent. However, she attributes this to an unwillingness on the part of French firms to provide jobs. In an effort to mimick the American economy, Ms. Spencer says these firms would rather simply pay out dividends.

Perhaps if the French succeeded in mimicking our economy, their labor costs wouldn't be so staggeringly high. While American firms can lay off workers when necessary, for the French it is exceedingly difficult. Unions dictate the wages and benefits of roughly 90 percent of the labor force, making French workers approximately twice as expensive as their American counterparts. The view is no better for prospective workers, who face a choice between high income and payroll taxes or lavish unemployment benefits. French workers who succeed in finding a job often find their incomes rise little if at all.

If French firms would rather pay out dividends, it is because the alternative of growing their business by taking on more workers is correspondingly unattractive. If the French want all these social benefits they can certainly have them, but Ms. Spencer should be honest about their costs.

1 Comment:

Blue Cross of California said...

The French health care system is great and I hope the U.S. can soon adapt to a similiar health care system.