2005/01/13

France has a bloated central bank but no currency

WHAT DO they all do? France’s central bank employs 15,000 staff — more than seven times the number who work at the Bank of England — despite the absence of a currency to manage or interest rates to set. Furthermore, according to the 2005 Central Bank Directory from Central Banking Publications, despite the fact that the Banque de France lost control of interest rates in 1999, staff numbers have fallen by only 3.6 per cent. Read More

4 Comments:

LOL, yeah, nice job if you can get it.
1/13/2005 12:52:00 am  
You're not getting off this lightly. I know you have more to say about the way this system runs especially as pertains to employment. If you could make changes what would they be?
1/13/2005 02:05:00 am  
"You're not getting off this lightly."

Dang! :-)

Ok, this is gonna be long, but you asked for it!

The Problem:

Because of the social laws in France, most of them dating back from the 30s and 4os era, it is next to impossible to fire public servants. I don't know if the employes of the Banque de France are public servants, but even if they are not, they obviously enjoy the same job security privilege.

As the country has evolved over the decades, various public services naturally also changed. Some old ones that were relevant in 1950 have been scaled down, others have become bigger, some have disappeared and/or have been fused into other services, etc. Also the impact of technology changes the requirements for man power.

For instance, the Trésor Public (= the IRS in the US) has in the last few years computerized all the tax return handling. You can now do your tax returns over the Internet. Lots of money spent on high tech monster computer systems, but it costs a lot less to run than employing lots of ppl to do the work manually. Problem of course, yes, you guessed it, is that all these public servants of the Trésor Public had no intention of resigning because they are no longer needed. So the gov still has the same huge wage bill on top of the investment of all the fancy computerized system, and as well the added cost of running that fancy high tech system.

This no-firing policy has been a real hindrance to public services progress because it means if a public service needs to be scaled down, you're stuck with the manpower employed. And even if they end up doing nothing, you still need not only to keep paying not only their wages but also the cost of maintaining the infrastructures (the buildings where they *work*, the electric bill, telephone, etc).

This obviously costs beaucoup money. And money is what is needed to improve services the services that ARE of actuality. The end result is the gov has a much higher than necessary bill to fork out than it would if it could dispense with unneeded manpower. The other result is that we have a mind-boggling workforce of public servants. I've read once we were second only to the USSR, and we're pobably now N°1. I'm not certain of the figures, but I believe one working person in five is a public servant.

The Solution(s):

Well, the obvious solution would be to change the law that affects the status of public servants and their current *unfirebility*. However it's easier than done. Just because the number of public servants is so staggering, they have a huge power. Any suggestion by the gov - let alone proposal - to reform their status would immediately result in the entire public servants workforce to go on strike, effectively paralysing the entire country. A real catch 22 situation.

So, what else can we do? A few things.

First, thank goodness, ppl don't live for ever. Even public servants eventually drop dead. So, the method our various govs have used so far to get rid of public servants no longer needed has been: wait till one by one retire. Eventually, after a few years, their number becomes small enough that the remaing ones can be reposted in services that ARE of relevance. But this takes a long time, and in the meantime the bill is still enormously inflated for no reason other than having to pay ppl producing nothing.

And while many public services no longer up to date with the needs usually down-size of a period of time, thus making the "wait till they kark it" approach not completely ridiculous, cases like the Banque de France show the inadequacy of such measure in one grand show of grotesque farce. The fact the Banque, after the conversion to Euros and other factors was SUDDENLY reduced to a fraction of its former role means that we just as suddenly watch the farce where 90% of the employees have nothing to do. And can't be fired!

Another approach, fairly recent this one, has been to offer the jobs that were till recently under the public servant status to the *normal* public. Meaning, for instance: teachers in public schools always have been public servants, but for the last few years, the gov has been offering teaching positions that do NOT have the public servant status.

The aim is similar to the previous scheme, but goes a bit further: you wait for public servants to retire, and the now vacant job is offered as a non-public-servant status. Needless to say the public servant workforce is screaming treason, but since it doesn't directly affect the job security of the existing ones, they are grumbling a lot but lumping it.

I'm not sure whether there are other schemes the gov is trying out to reduce our overbloated, useless beaurocratic population. At the present, I'd say the gov is prolly doing all it can, and things will change for the better. But it's going to be a long time.

Unless some serial killer goes on rampage and rids us of half the public servant population.

I guess another 1789 could be an solution: the *normal* people revolting in the streets against our new breed of aristocrats, the *public servants* [g]
1/13/2005 08:01:00 am  
God I would rather be having this sort of discussion in America than the rampant, out of control Capitalism we have...I would rather argue about re-training workers than having all control taken away, waking up one day to find the company stock has tanked and my 401k life savings are suddenly worthless!
1/13/2005 02:22:00 pm  

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