Letter from France – When will they learn?

18 Jan 2021

Looking at recent events, Alan Kirman reflects sadly on the lack of communication between governments, in France and the UK, and the people they govern.

My father told me, when I was very small, that ‘intelligence is the capacity to profit from previous experience’. Judging by what has been going on in the world in general and in the UK, the US and France, intelligence so defined has been in very short supply among those who govern. I suggested last year that 2020 could not be much worse than 2019. How wrong can you be? Consider the case of France. The beginning of the year after massive protests about pension reform got off to a bad start. The government was reduced to forcing the highly unpopular reform through in February. As Le Parisien said in its headline, ‘Prime Minister Édouard Philippe pushed through the Macron government’s controversial pension reforms without a parliamentary vote on Saturday, after the opposition filed more than 40,000 amendments to the draft law’. To be fair, debating that number of amendments would have taken time, but the popularity of the government fell even lower as a result.

Then came Covid-19 a gift from the ‘Invisible Hand of Jupiter’ as Adam Smith described the cause of exogenous shocks. Despite its terrible human cost this should have been the occasion to show what good governance could do to face up to a catastrophe. There are, of course, extenuating circumstances, there has been a great deal of uncertainty about the nature of the virus, its transmission and above all about how to treat severe cases. But some things have been understood for some time now. PPE or personal protective equipment was always going to be useful in many of the public health crises that France might face, including as it turned out, the current pandemic. Resilience, a term much used these days, involves, in part, having reserves of products such as surgical masks which become essential in an emergency. It is not intelligent to have a ‘just in time’ supply chain in those circumstances. What is needed is a ‘just in case’ stock. France was relatively well armed in this regard. It had 754 million units at the end of 2017, but as the limit dates for their use passed, the strategic stock of surgical masks dwindled to only 100 million at the end of 2019. The Directeur Général pour la Santé (DGS) was warned of this decline and the medical authorities recommended building a stock of a billion masks. But investigation by the French Senate in December 2020 has revealed that the order was reduced to 50 million  for budgetary reasons and that the scientific report recommending the stock of 1 billion was modified  a posteriori, to justify this decision.

Then came the onset of the pandemic. At the start things were chaotic, recommendations were contradictory and for some the whole problem was overblown. Yet, as the number of deaths and people in intensive care increased there was still an air of disbelief. In Marseille Professor Didier Raoult who asserted that the well established drug hydroxychloroquine had a positive effect in the treatment of Covid and whose advice was followed by Trump and Bolzanaro, became a folk hero. Statuettes of him were selling like hotcakes this month. But, after the first wave which was dealt with by a lockdown, things seemed to come back to normal until people went off together to crowded beaches and parks and by October the second wave had hit. Social distancing and mask wearing were recommended and were enforced on public transport. But, as the number of deaths and entries to intensive care started to climb the answer was to install a curfew from 9 pm and to limit travel to a minimum. This has not had the desired effect at the time of writing and although Christmas travel will be permitted the curfew will be in force on every day except for Christmas Eve and the ski resorts will remain closed till the middle of January. Vaccines will be distributed as from the beginning of January to the most vulnerable and the most exposed but all of this can be changed at short notice.

Polls show that the French have a poor opinion of the government’s handling of the pandemic and the question is whether that is justified. Teachers who have recently been told by the Minister of Education that it is essential to keep children in school are troubled by the announcement that it would be desirable to keep children at home on the Thursday and Friday before the holidays. This is the essence of the problem. When faced with a rapidly evolving problem where information about it is constantly changing, how should the authorities handle it so that the information and the evidence that it contains is accepted? The reasonable individual would admit that measures taken need to be changed if the reasons behind the change are explained. However, the basic attitude of the government is that ‘we receive expert advice and you should follow it’. That does not work and, by now they should have understood this. If advice on one day is followed by orthogonal advice on the next, people have to have a lot of confidence in those giving the advice to follow it. But time and time again authority is exercised without consultation and prior information and the public are extremely sceptical about the competence of those in charge especially after the mask fiasco before the onset of the disease.

On a comparative basis a number of countries seemed to have outperformed France in terms of handling the pandemic but the recent bad experiences of South Korea and Germany suggest that France, while not doing well, has not suffered as badly as the US the UK and Brazil for example and is somewhere in the middle of the field. Yet one message has become clear which is, that what is of prime importance, is the confidence that the public has in the person who is proffering the advice. As I will point out in what follows this is the weak point in France but much more so in the UK. As I am writing Macron has declared that he has tested positive for Covid and is in a 7-day quarantine. He joins a number of heads of state, but he, unlike the others, did not minimize the Covid problem. Now that vaccines are going to be available, things may improve. Unfortunately, there are still many people who are hesitant about being vaccinated. But, as a recent article from INET1 argues, one thing stands out, putting the economy above the public health problem does not pay off.

 

Brexit and fish

Let me come to my second topic, that of Brexit, which is coming to an untidy end. The French have a real interest in this but they feel with considerable justification that the Brexit campaign gave a completely distorted picture of the picture and that the UK’s insistence on modifications in both quotas and access to territorial waters is outlandish for people who should be prepared to pay a price to gain some benefits from a club that they have decided to leave.

The leave campaign for Brexit used fishing as its poster child. Getting back ‘sovereignty’, however that was defined, was an essential part of the story which was supposed to have a populist appeal and was a nostalgic reminder of  the time when Britannia ruled the waves. The idea purveyed was that of many small fishing boats unable to fish enough as a result of the nefarious practices of French, Spanish and other European vessels. So, increasing and redistributing fishing quotas would be an important contribution to the UK fishers and the towns where they were based.

But, a more careful look at the fishing situation raises a number of problems. Firstly, who actually does most of the fishing or, put another way, who owns most of the fishing quotas at the present time? The shadow secretary for the environment in the UK drew attention to a report on the fishing industry in the UK published in 2018.2 That report showed that a large proportion of fishing quotas was owned by families on the Sunday Times ‘rich list’,3 and foreigners. This means that the idea that the UK fishing industry at large would profit from leaving the European Union was questionable.

The interesting question here is how fishing came to be such an important sticking point in negotiations. Catching fish makes up just 0.1 percent of the British economy and employs barely 12,000 people, or 0.04 per cent of the British workforce. Even if the fish processing industry, which is roughly twice as large is included, the whole industry is very small indeed.

People in the UK have very conservative tastes in fish and 75 per cent of the fish they eat is concentrated on five species: salmon, cod, shrimp, tuna, and haddock, and, in part because of this, 80 percent of British fish landings are exported, mostly to the EU. If there is no deal, these exports will carry tariffs which will, paradoxically cause most harm to the small fishermen who catch a lot of shellfish. The bigger shellfish markets are largely European: France, Spain, and Portugal in particular and making access to those markets more difficult will be very problematic for those who were supposed to gain from Brexit. Neither will the smaller fishermen benefit from a redistribution of quotas as the Government White Paper on the subject explicitly states that there will be no redistribution of quotas.

As the EU quota system evolved, quotas became commodities and in such a framework the small players soon essentially disappeared. Although small vessels make up 79 per cent of England’s fishing fleet they have only 2 per cent of England’s quotas. half of which are ultimately owned by Dutch, Icelandic, or Spanish interests. More than half of Northern Ireland’s quotas were concentrated on one trawler which has recently been replaced and the new vessel is too large to land its fish in Northern Ireland. As for the quotas for Scotland which is the largest UK fishing nation, five families on the Sunday Times ‘Rich List’ own or control directly and indirectly nearly half (45 per cent) of them. With, or without, a deal the bulk of UK fishing rights in the hands of a small domestic elite and a handful of foreign multinationals, not exactly what the Brexiters had promised.

Responding to the report at the time, the shadow environment secretary Sue Hayman said ministers needed to take ‘urgent action to use the powers that they have domestically to redistribute fishing quota to deliver a fairer deal for smaller boats. Fishing was the poster child of the Leave campaign, and environment secretary Michael Gove has already broken promises he made to the industry to secure full control of our waters during the transition,’ she continued. ‘With all the talk of “take back control”, ministers have the power to distribute UK quota now and put the smaller-scale fleet first. So why wasn’t it mentioned in their white paper? This report shows that, while it points the fingers at others, this government is to blame for a sector rigged in the interests of the super-rich. Any future fishing policy must consider how new and existing quota can be more fairly distributed and we will treat this as a priority in the upcoming fisheries bill.’

Yet, the government has continued to vaunt the benefits to the fishing industry of Brexit, even with no deal and, of course, nothing of the potential redistribution of quotas has happened. Furthermore, the threat to send the gunboats in to police UK waters has a distinct 19th century flavour to it. 

 

Climate change policy

The third problem that I wish to mention is that of policy towards climate change which has become something of a French speciality in recent years. The Paris Agreement, and the recent follow-up conference on the subject have placed France as a leader in the field of positive action in response to climate change. Yet paradoxically, while Macron insists on the importance of the problem, his inherent bias towards the private sector and the idea that it is only there that one will find adequate solutions to pressing problems, has prevented him domestically from taking major steps. He recently convoked a Citizens’ Convention on climate change. After much discussion the convention came up with 150 proposals for measures to improve the situation. Macron proposed to implement all of the 150 propositions without any modification. So, once again he gave the impression that he was listening to the French people and wanted to do something in their interests after consulting with them. However, when it came to the time to do something concrete about this, he only put 50 of the original proposals on the table. This produced an angry reaction from those who had participated in the convention and felt that they had somehow been cheated. Macron’s reaction was to argue that it was necessary to modify Article 1 of the French constitution, to include considerations of environmental importance. This proposal attracted a lot of attention and shifted the focus from the fact that the convention was not being followed. But, it is not clear that this will in any way reinforce confidence in those who govern France. As someone once said, ‘one should say what one means otherwise nobody will believe that one means what one says’.

On the environmental front, it is interesting that France in order to keep its emissions low has decided to keep nuclear power at the centre of its energy policy. France currently generates 75 per cent of its electricity from nuclear power and has promised to reduce that to 55 per cent by 2030. This poses two problems, firstly what will be the source of the electricity to replace that currently generated by nuclear power? Secondly how will the ecologists greet the announcement that nuclear power is not to be phased out? It is worth recalling that France earns some 2.5 billion euros annually from exporting electricity. Once again it is not difficult to see that Macron has come down on the side of economic interests.

 

Conclusion

There is a common thread running through much of what I have said and it is that governments that either take an authoritarian, or to be kinder, a paternalistic attitude, or who simply do not tell the truth, tend not to generate much confidence in the populations of their countries. Not only have the problems that I have mentioned been at the forefront in 2020 in France, but there has been a series of other problems which have come up in this country which have shown the same tendency. A fairly radical reform of the French University system and of the research organization has been pushed through despite almost unanimous condemnation of academics and researchers. Many of the promises made have not been fulfilled and it seems that the government pays little attention to the actors in this sector. The result has been a loss of trust in the government, if there had been any, by both students and university teachers in France.

As another example, recently a law was proposed and an amendment voted to prevent people taking photographs of the police when on duty. This, it was claimed, was to protect the police from possible attacks. Yet, as huge demonstrations have shown, most people laboured under the illusion that the police were there to protect the people and not vice versa. This is but another reflection of the lack of communication of the government with the people it governs. I dare not even hope this year to suggest that the next will be better but, being as bad a forecaster as many economists, I hope that my forecast will be wrong.

In any event however all of this turns out I would like to take the opportunity to wish all those who read this a Happy New Year.

Notes:

1. Phillip Alvelda, Thomas Ferguson, and John C. Mallery ‘To Save the Economy, Save People First’ INET publication November 2020

2. The report by Unearthed, part of Greenpeace was published in September 2018

3. This list, of which I was not aware before writing this piece, is published each year by the Sunday Times and lists the 1000 wealthiest families in the UK.