france and germany
France and Germany
Vocabulary
| blame | model (2) | living beyond our means |
| belt | gradually | tighten our belts |
| tight | evident | competitive |
| ironic | impact | resistance |
| minor | rooted | restructure |
| tune | significant | to the tune of |
| critic | surplus | cutting edge |
| region | reverse | civil servant |
| proud | cut costs | expenditure |
| wage | achieve | minimum wage |
| reform | converge | public sector |
| suffer | prosperity | interlinked |
| deficit | structure | bottom out |
Video
Transcript
German workers are paid 32 euros and hour; French workers get 35.
The retirement age in Germany is gradually being increased to 67. People in France can retire at 62.
The unemployment rate in Germany is just half what it is in France.
Michel Godet, Economist: “We’re living beyond our means. We’ve got to tighten our belts like the Spanish are doing. We have to get back into positive growth.
But France has never wanted to make the effort.
We’re like a school child who gets bad grades — and blames the good pupil for it.
In Europe, the good pupil is Germany. But we shouldn’t blame those who do well . . . we should model ourselves on them.”
France’s weakness is evident in its foreign trade imbalance: aircraft and aerospace technology are among its most important exports, followed by medical products and food.
But the country imports more than it exports.
Its trade deficit in 2013 was 76 billion euros.
It’s different in Germany.
It’s biggest exports are cars and replacement parts. Machinery takes second place, and chemical products third.
Germany exports more than it imports. Last year, it took in a record surplus of 198 billion euros.
Germany’s biggest surplus with trading partner was ironically, with France, to the tune of 40 billion euros.
Henrik Enderlein, Director, Jacques Delors Institute, Berlin: “Where exports are concerned, German goods have become more competitive in recent years. Quality has risen.
The German automobile industry is incredible respected worldwide . . . even more than ten years ago.
Germany has made significant progress in cutting edge technology. But that success is not rooted in the past two or three years — it comes from a whole decade of restructuring.”
French presidents Francois Hollande avoids restructuring because it will cost him votes.
And he’s already unpopular.
Critics say that so far, he’s risked only minor reforms.
Michel Godet, Economist: “Reducing the number of civil servants especially regional ones, which is much too high in France. Our public expenditures are 11% higher than Germany’s; thirty years ago, it was the reverse.”
Things can be done differently.
The second important measure is the cost of labor. We have to cut costs, but we have to go further and think about having differing minimum wages in different regions.
French workers are proud of what they’ve achieved and refuse to accept any cuts. Unions say large pay-hikes in Germany would help France out of a crisis.
Henrik Enderlein, Economist: “Germany cannot become a growth-engine for France now because you cannot dictate to German consumers or companies what goods they are supposed to demand.
That’s primarily a French problem.
France has to reform its own structures, open its labor market and cut costs so those structures finally converge again between Germany and France.
Flourishing French businesses and strong growth in France are essential to Germany’s prosperity in the long-term.
Henrik Enderlein, Director, Jacques Delors Institute Berlin: “The German and French economies are very closely interlinked.
40% of the parts in a German luxury car, like the BMW 5 Series, are made in France. You could paid half the car in the colors of the German flag and half in French and call it a half-French car.”
If France bottoms out economically, it will impact directly on the German economy.
We’ll suffer as well.
So it really is in Germany’s interest to lead France back in growth.”
Resistance to reform is massive.
Time and again there are demonstrations like this one by public sector employees in Paris.
Questions
1. French and German workers have the same conditions. Is this true or false? What are some differences between French and German workers?
2. What is the student analogy? Does the French economist blame Germans or the French? What does he recommend?
3. Describe France and Germany’s international trade (exports and imports).
4. German competitiveness and the quality of their products and services have increased over the years. Is this right or wrong? Why has it improved?
5. Has France conducted political and economic reforms and restructuring? Why hasn’t it restructured? What reforms should they undertake to boost their economy?
6. France and Germany’s economies are completely independent of one another. Yes or no? Can one entirely succeed while the other fails?
7. Do most French favor or oppose restructuring? What is their reaction to proposed reforms?
A. How do you compare the French and German economies and policies?
B. What do you think the French and Germans should do?
C. What will happen in the future?
D. What is the situation in your country?
E. Do you think there should be changes or reforms in your country?
