Friday, June 20, 2008

Sarkozy is a Fool

I've written many times that Nicholas Sarkozy is a fool, but this belief was confirmed anew after Sarkozy's latest rant against Peter Mandelson because Mandelson has the termerity to support free-trade and the abolition of CAP.

Mandelson's position is not exceptional though. His predecessor as Trade Commissioner, Pascal Lamy (who was a member of Mitterand's government) was also very much in favour of abolishing CAP and pushing free-trade. And Lamy impressed so much on his free trade credentials that he was appointed to head the WTO. But then the socialists do not get votes from farmers and are not enamoured with the argument that precious resource should be diverted towards them. The Barroso Commission at large is in favour of free-trade.

What was extraordinary about Sarkozy's outburst though was his piss-poor understanding of economics and the dynamics of subsidy. The whole point of CAP is that it puts a floor on prices, via the "intervention price" that protects against low global prices. The idea is that if prices get too low, farmers are tempted to abandon the land and the intervention price prevents this. Abandonment of the land is the big European fear, dating back to WW2 when food could not be imported. Land that has been concreted over is lost to food production forever - hence the intervention prices and the payments for set-aside to keep land in a condition that it can be ploughed at any time.

However, when world prices are high, the intervention price is not needed at all, and neither are the payments for set-aside. The farmer can make huge profits just by ensuring that he meets demand. Therefore Sarkozy's argument that high food prices requires more CAP is complete bull. We will never see such an auspicious time to reform CAP. It's like reforming benefits - you always do this in times of full employment because the hurt is minimised. Reforming CAP should take place now, while high world food prices mean that farmers won't really hurt from the reform at all.

The French must be really regretting electing Sarkozy. He's achieved little and managed to annoy Germany, Britain, the EU Commmission and China. His only pal is fellow conservative Dubya.

Speaking of conservatives - Sarkozy proves the principle of Vote Conservative, Get An Idiot, which we first saw in action in the USA.

Conservatism = Bush = Sarkozy = Idiots

British people should take note when they go to the polls for the general election. Don't let it happen here!


Anonymous said...

'It's like reforming benefits-you always do it in times of full employment'

So does that mean we will never reform benefits in the UK?

snowflake5 said...

anonymous - we are close to full employment at the moment. 74.9% of the workforce is in work - an all-time record. And yes, the government is taking the opportunity to refom incapicity benefit as we speak.

As to the future - it depends whether there is a Labour or Tory government. Conservatives are the party of Recessions (and Idiots a la Bush/Sarkozy), so reform will probably stall under them.

Anonymous said...

5 million people not working and you call that full employment,your either having a laff or just following the latest line in spin.

I would certainly agree with you that the slavish following of USA foreign policy by Blair,Brown,Straw and the various Labour cabinets over the past 11 years would at the very least qualify them all as idiots,but that's being polite.

snowflake5 said...

anonymous - the total of people on unemployment plus incapacity benefits is way lower than ANYTHING achieved under the Tory government.

In 1994 only 67.9% of the workforce was in work, and that was an improvement on the depth of the 92 recession. Therefore, yes, 74.9% of the workforce is full employment.

But here's a challenge for you. If Tories really believe that they can get more people into employment, then pledge to have 80% of the workforce in employment. Hell, why stop at 80% - pledge you'll achieve 85% or 90%!

Bet you won't make the pledge though. Because Tories talk big but are too Chicken to commit to a pledge. And because Tories have never ever even achieved 74.9% of the workforce in employment when they were in power - and crucially they know they don't have it in them to perform better than Labour on employment.

Anonymous said...

Snowflakes,do you really still believe any statistics that this government uses,you will be telling us next that you believe our current inflation rate is 3%!!!!!

snowflake5 said...

anonymous - the employment stats are calculated in accordance with International Labour Standards and also Eurostat standards.

I understand your suspicion of employment stats - the last Conservative government used to claim that only people actually claiming unemployment benefit were unemployed. The ILO standard however counts people as unemployed if they are seeking work, even if they arn't claiming benefits, and hence always gives a higher unemployment figure.

Unemployment as measured by the ILO standard is 5.3%, but the claimant count is 2.7%.

It is to the Labour government's credit that they immediately introduced the ILO standard in '97 when they came to power, even though it gave a higher figure. Expect a Conservative government to go back to the claimant count figure only, especially as they usually cause mass unemployment.

I note that you didn't take up my challenge for Conservatives to pledge to have a higher portion of the workforce in work than Labour. :-) Chicken!

Anonymous said...

Conservatives are the party of recession, who the hell is in power now the Tories.

As for getting people back to work and we have full employment where. My area has one of the highest unemployments in the country it's so bad now the Labour Council are arguing with the Labour government, one says we have 2% unemployment and the council says it's 38% the job center says it's about 45%.

Who the hell is telling porkies

snowflake5 said...

anonymous - we are not in recession at the moment. The economy is growing - in fact it's growing more srongly than in the lead up to the 2005 election.

I don't know which part of the UK you are from, but where I am (in the south) we definitely have full employment. My other half needed to recruit two IT people - and had real difficulty finding applicants. In the end the two people who turned up for the interview were hired! That's how tight the labour market is.