Inasmuch as Susie and I shall be going to Paris for four weeks next Saturday to spend time in our pied-a-terre in the 5th arrondissment, I have been thinking a good deal about the recent election there, and the conventional wisdom of the mainstream media concerning that lovely country. The universal view of the talking heads is that although France is a nice place to visit, it has no future unless it gives up its quasi-socialist Gallic ways and adopts the American economic model. The only disagreement among the commentators seems to be over the likelihood that Nicholas Sarkozy will be able provide the requisite tough love to the pleasure-loving French, hooked on short work weeks, long vacations, and leisurely lunches en plein air.
The statistic most frequently trotted out to support the conventional wisdom is the unemployment rate in France, which last year had come down to 8.7%, making it a bit less than double the rate in the United States.
A contrarian to the core, I decided to gather some statistics from the web, and do a somewhat more careful comparison of the employment situation in the two countries. Herewith the results, as briefly and with as little pain as possible.
The United States had a population of 301 million and a civilian labor force earlier this year of 152.6 million. The labor force includes 145.8 million employed persons and 6.8 million umemployed persons. It does not include 1.4 million persons who are described in the Bureau of Labor Statistics publications as "marginally attached to the labor force," meaning that they have looked for work in the last year, but not in the last two or three months, and would like jobs, but are "discouraged" by their persistant failure to find them.
France, in 2006 [the statistics do not exactly correspond, but are adequately comparable for my purposes], had a total population of 61 million and a labor force of 27, 638,000, including 2,717,000 unemployed. [I have no figures for the "discouraged."] This comes out to an unemployment rate of 8.9% [why the documents list the rate as 8.7% I do not know.]
However: France has a total prison population of about 52,000, whereas the prison population of the United States is roughly 2,194,000. Since the population of the United States is almost exactly five times that of the United States, there is, in a manner of speaking, an "excess" U. S. prison population of 1,930,000. There is a corresponding "excess" population of correctional officers [prison guards] of 425,000.
Now, suppose we add the excess prisoners and guards to the ranks of the unemployed, and see how that changes the unemployment rate. The extra prisoners increase the size of the labor force, but the guards do not, since they are already included in it. The result, as the reader can confirm, is an unemployment rate of 5.9% If the persons marginally attached to the labor force are also included, the real unemployment rate is 6.77%
Now, there is a significant difference between 8.9% or 8.7% and 6.77%, a difference that corresponds to a great many men and women [disproportionately young and Muslim in France] who cannot find work. Balanced against this difference is the vastly more generous system of social services, including child care, health care, and a vibrant public life. Incidentally, I have read [but do not have in front of me] statistics that show that the productivity of French workers is quite as high as that of American workers. Even though they work a thirty-five hour week and take long vacations, they are not lazy or incompetent -- simply more concerned with living a good life.
One final bit of information -- I also took a look at the relative size of the two military establishments. The American military is, to be sure, five times that of the French, but since that is the population ratio as well, it seemed tendentious to include some of the American militaru in this recalculation of unemployment rates.
By the way, lest anyone imagine that this way of studying an economy has anything new about it, I will note that I am simply borrowing a mode of analysis from Adam Smith, who in his great work, On the Nature and Causes of the Wealth of Nations, contrasts the unproductive labor of the servants of the landed aristocracy with the productive labor of the employees of agricultural and industrial entrepreneurs.