Austerity May Begin to Toll for France As Well

A big French carmaker makes painful cuts even as it grows increasingly clear that Hollande may have to inflict austerity on France.

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Thibault Camus/AP

Workers of French carmaker PSA Peugeot Citroen demonstrate in front of the factory in Aulnay-sous-Bois, north of Paris, Thursday, July 12, 2012. Struggling French carmaker PSA Peugeot-Citroen is slashing 8,000 jobs in France and closing an iconic site north of Paris. (

Political pushback was fun while it lasted. But just three weeks after European Union leaders agreed to loosen austerity and bail-out conditions in the hopes of allowing debt-swamped members room to stoke their faltering economies, governments across Europe are again struggling to prevent resurgent economic and social adversity from swamping them.

Those challenges ranged from street violence in austerity-groggy Spain, to news from France Thursday that carmaker PSA Peugeot Citroën will be cutting 8,000 jobs–the latest in a rising tide of restructuring by companies fearing prolonged economic sluggishness.

Apart from the job cuts, the carmaker said it was closing a plant north of Paris. It said the move was a response to sales that fell 13% in the first half of 2012, and part of a general reorganization its production and sales strategy to adapt to a shrinking European market increasingly dominated by luxury and ultra-cheap car producers. In explaining the cuts, PSA Peugeot Citroën officials sounded a the same kind of alarmed existential tone that governments like Spain have. Quite clearly, Europe’s dire financial and economic has left virtually everyone in a tight, urgent bind–whether they’re in government or business. “The group is facing a business tsunami in Europe, and we’re in the middle of it,” PSA Peugeot Citroën chairman Philippe Varin said Thursday, as furious union leaders denounced an “act of war” they vowed to avenge. “I’m absolutely determined to see this plan through, (because) it’s the only path possible for the group.”

France’s leftist government responded to the PSA Peugeot Citroën lay off news by demanding that the private, independent company provide details of what cabinet memhers called a “real shock for all employees of the group.” Socialist Prime Minister Jean-Marc Ayrault also ordered a “a support plan” be prepared by July 25 to outline possible ways of assisting France’s automakers—a move that swiftly mobilized and livid unions warily welcomed.

The skepticism of union leaders is understandable, since it’s difficult to imagine how the government could possibly help out in any meaningful way. The money simply isn’t there.

An audit revealed earlier this month indicated the French government already must find up to $12 billion this year and $43 billion in 2013 just to meet the deficit reduction targets it has promised Brussels. The government has so far sought to recoup that initial shortfall with tax hikes primarily hitting the wealthy and businesses. But that won’t be enough to fill the hole—especially if the state starts throwing cash at heavy industries to limit proliferating lay off plans.

French Socialist François Hollande has pledged to spare ordinary consumers more pain than they already feel–and shift most of that to the wealthy. Yet experts say some boost of France’s value-added tax will be inevitable to recoup the nearly $55 billion that’s needed to meet deficit reduction targets through 2013. Meantime, Hollande’s government is already showing signs of preparing to increase a tax linked to salaries, despite repeated promises the very suggestion was unacceptable. The reason for the rethink: each percentage point that particular tax is boosted will bring an additional $15 billion in to drafty state coffers. Given that, it seems unlikely Hollande will be able to continue renouncing those resources as the crisis stiffens.

That’s especially true since the inability of any EU government to start giving companies money to forestall restructuring plans means the resulting unemployment will put even more strain on already maxed out state funds. In business or government alike, leaders across Europe now seem to clearly see they’re facing a wall offering no easy way around it.

6 comments
famulla555555
famulla555555

In 2005, it was estimated that there were about 500,000 people, who were diabetic. Diabetes in Africa is known to be a large and growing problem, with the true extent of the malady in the continent not very clear. It is thought that the erosion of traditional diet and exercise patterns has led to a huge increase in the number of people with the condition. Karalla, “ a vegetable very bitter “more commonly known as bitter melon, is known worldwide for its miraculous medicinal properties. It is a natural wonder that has proven to be very beneficial for people with a number of diseases, particularly diabetes. Some have also believed that the herb not only aids and provides comfort, or reduces the symptoms, it supposedly cures the sickness altogether. Generally, everything in the plant may be used for medicinal purposes particularly as treatment for diabetes. However, the fruit is the most potent and effective for treatment. Despite its medicinal value, the World Diabetes Foundation (WDF) does not support or promote the use of bitter gourd for health purposes. Its communications manager Jamal Butt told Insight this week via email that neither do the Denmark-based organisation funds researches related to the fruit. Only problem with us we need tabsules, pill, capsules, or tablet. We are lazy and we want to create wealth? With what? This is not a political blog, just to remind all that like global warming, we will one day regret Were people from Gascony full of boasts and bravado? Not necessarily. Historical rivalries lead one people to generalize others' names as having some shortcoming and some of those names become part of the language. Other examples of such words are solecism, Boeotian, and fescennine.

Yes, everyone wants a fair shake. Created equal in the eyes of God is a good thing, but if I'm born with less (unequal) musical talent than my sister, perhaps I shouldn't be in the elite chorus. If I get a tryout after some lessons and some practice, and I'm turned down, that's fair. And to Mr. Fish's point about using the word "Fair" because it's effective, and I think it is, that isn't the point. Perhaps people were nodding because they understood the difference in the words as spoken in the context of the speech. The two terms have different connotations and different meanings, although they're frequently confused. The wages per hour for bagging at the grocery store won't be the same as the wages per hour of an accountant, for an example. Both wages may be fair for the work that's done, but they won't be equal. Equal and Fair are two different terms, and People are not Corporations.

famulla555555
famulla555555

The child always wanted to have his way. And if he did not get what he wanted he blew the house down. One day the parent took him to the doctor. The child cried and told the doctor, “I want to eat mosquitoes”. The doctor asked the nurse to get some mosquitoes. Child said, “Please boil these” They were boiled; He picked all except one and threw the rest. In the plate there was one only. He told the doctor to eat the half. Doctor wanting the fees, ate half and. The child screamed, “You ate my half” ooooo   Well, that is what our politicians are. Give they ask for more. Science is hard, and the real world is not waiting for these students with open arms. However, this article was eye opening and has encouraged me to provide a more supportive environment for my undergraduate engineers while they are learning the ropes. No question self-motivation trumps what we as educators do in the classroom or lab, but self-motivation isn't always enough when the challenges are hard and there is no positive feedback. Yes, our priorities as a country are warped with many of the best and brightest going into money laundering/ finance, following the dollars available. Regardless we do need to do a better job keeping those that remain in engineering/science because the house of cards that is finance is going to crumble eventually and we as a country won't be left with much else when it does if we don't do something to help prop up the technology infrastructure. The country as a whole may be willing to throw away a generation of scientists by redirecting dollars elsewhere, but that doesn't mean we as educators have to be complicit in aiding and abetting this, albeit unintentionally. I for one am going to rethink how I interact with my students because this tough love approach may not be doing us any favours. And to all the perpetual postdoc  PhDs out there, I do understand why you feel you were sold a bill of goods to join the academic science pyramid scheme. However, realize for most of you there are jobs out there, and in science, just not the ones you've spent 10+ years training yourself for (i.e. running your own lab), nor at the pay your deserve for the level of training and education you have. While that is by no means fair, the reward for all of us that stay in this endeavour, despite the pull of dollars elsewhere, is that you are doing something more meaningful for yourself, the US, and the world, than all the professional gamblers/money changers out there combined. Remember, a meaningful life is more than the $ amount in your bank account 

Firozali A.Mulla
Firozali A.Mulla

Saturday, 11

August 2012 The BIG FIVE seem to be getting smaller when it

comes to trusting these banks.  Barclays on

Thursday said industry veteran David Walker would

become its new chairman from November, succeeding Marcus Agius who

resigned over the Libor rate-rigging(

never heard of this before do not want to hear any on this again)  scandal that

has rocked the British bank. A statement said "Sir David Walker has

been appointed as a non-executive director of Barclays with effect from 1

September 2012 and will succeed Marcus Agius as chairman of Barclays with

effect from 1 November 2012." Walker, a former deputy head of the Bank of England and

ex-chairman of US bank Morgan Stanley, said his "immediate priority, and

critical to Barclays' ongoing success, will be the appointment of a new chief

executive." Barclays is looking for a new chief executive after US

national Bob Diamond quit the post at the start of July along with Agius and

the bank's chief operating officer Jerry del Missier owing to the Libor scandal

The London-listed bank was fined £290 million ($453 million, 369 million euros)

in June by British and US regulators after admitting that it attempted to

manipulate the Libor and Euribor rates between 2005 and 2009. Britain's Serious Fraud Office is

considering whether to bring criminal prosecutions over the Libor scandal,

while Prime Minister David Cameron has

launched a parliamentary inquiry into revelations that Barclays traders lied

about the interest rates other banks were charging it for loans. Libor,

or London Interbank

Offered Rate, is a flagship London instrument used as an interest benchmark

throughout the world, while Euribor is the eurozone equivalent. The

rates affect what banks, businesses and individuals pay to borrow money, while

the scandal risks engulfing banks across the world. Walker, who is 72,

has worked at Britain's Treasury and is presently a senior advisor to Morgan

Stanley, said he was looking forward to playing his part "in taking the

company forward after recent events." We know that the banks create

cash but this is certainly the strangest way to siphon the cash from the

public. This is theft put in simple English terms What good will come out of it

is not clear but what is clear is that it's a disabled world, and I believe,

the doctors and dentists can do better than these bankers and economists today.

It is like we are in between, "Did we come here to laugh or cry? Are we

dying or being born?" With the rising costs and expenses each day, and the

incomes on decline or defunct, and no one ideology in works, the alternative is

to combat the economic terrorism by the banks, and break them apart, get rid of

the third party order and tear it down, and all that we are serviced and valued

by the last centuries in our new millennium. How happy we are when the records

are broken at the Olympics and new ones are established, and it is time to

create that kind of human spirit in asset, value and consumerism. People of the

world get united than remain divided, in debts, depressed or bankrupt. Where

are the doors and the windows for escape if any show me I need one or two thank

you Firozali A.Mulla DBA

tomthumb015
tomthumb015

The French will only be happy when they only work 20 hours per week, and get a 100% pay rise?

Firozali A.Mulla
Firozali A.Mulla

In a further blow, the IMF said the Government was not expected

to hit its goal of slashing the ratio of debt to gross domestic product until a

year later than it had hoped. A year later, meaning 2014 bearing in mind that

we are now in 2012. Observing that the Chinese economy is too large

for it to pick and choose which rules it will follow without risking the

integrity and legitimacy of the international system, the US on Wednesday asked

Beijing to be more transparent in its economic policies.

Firozali A.Mulla
Firozali A.Mulla

I

wonder why we approach the small businesses for taxes The huge ones are the

ones who pay the huge amount or at least are supposed to pay the hefty tax?

In

April, US President Barack Obama signed a law to

make it easier for small American businesses to raise capital. Many Indian

start-ups are now plotting to take advantage of the so-called 'JOBS' Act and

the looser regulations it has enabled to list on an American stock exchange.

 US President Barack Obama called on

Congress Saturday to approve an extension of tax cuts for most Americans, but

not the top income earners. "Under my plan, 98 per cent of American

families won't see their income taxes go up at

all," Obama said in his weekly radio and Internet address. "But the

other two per cent of Americans will have to pay a little more in taxes on

anything they make over $250,000," the president continued. "In other

words, the wealthiest few Americans will go back to the income tax rates they

were paying under Bill Clinton." The comment came as a political fight

between congressional Democrats and Republicans over future taxes

began to heat up. On January 1, a tax cut adopted under former president George and extended under Obama is set to expire. But

Democrats and Republicans strongly disagree over how to extend it. While Obama

favours higher taxes for the rich, Republicans argue it would undercut the

nation's fragile economic recovery. In his address, Obama argued that if the

tax cut is allowed to expire, it "would be a huge financial hit for

middle-class families." But he rejected the notion favoured by Republicans

that wealth accumulated at the top will eventually trickle down and help create

jobs for middle-class Americans. "We already tried it that way for most of

the last decade, and it didn't work," the president argued. He said the

country needed policies that will grow and strengthen the middle class, will

help create jobs and make education and training more affordable. But

Republicans again rejected the president's approach. Delivering a weekly

Republican address, US Senator Rob Portman of Ohio said Obama's plan would

result in a massive tax increase on nearly one million small businesses. "And raising taxes on job

creators during a jobs shortage makes about as much sense as cutting off the

water supply during a drought," Portman said. May be the magic wand of

VETO comes in USA again. I love this . When you disagree you VETO and all hush

up, zip and pay the taxes. Would that be anarchy? I thank you Firozali A.Mulla DBA