Economic proposals (6/6)

REDUCING SOCIAL WELFARE BENEFITS AND ADJUSTING THEM IN TERMS OF PURCHASING POWER PARITY BY GEOGRAPHIC AREA
We are currently in a period where budget levels are low. It is therefore necessary to reduce social welfare benefits so as to make way for much-needed savings. We must make sure, however, to show intelligence, flexibility and good faith when doing so; these three qualities are the hallmark of modern democracies.
In particular, as the cost of living is not the same in Paris, Toulouse, or Castres, my suggestion is to make the reduction proportional to the annual average purchase price for a five-main-room dwelling, related to the annual average salary for a family. Currently, families have 2-3 children, and the main dwelling constitutes both the biggest bottleneck in households’ budget and key, high-priority investing for the family’s future.
Calculations ought to be checked by INSEE (the French National Institute for Statistics and Economic Studies) and validated by the government. I suggest the following clusters of areas, for necessary readability and simplicity:
- Paris region
- Lyon and Marseille regions
- Large regional centers (Montpellier, Toulouse, Bordeaux, etc.)
- Préfectures and sous-préfectures
- Small towns and villages

MACROECONOMIC ENVIRONMENT + ENTREPRENEURSHIP
Let’s review my personal vision of the French economy: Key necessary steps are as follows: 1. Stabilizing the macroeconomic environment; 2. Boosting growth through entrepreneurship.

1. Convergence of opinions regarding the macroeconomy

Economic science is not hard science; rather, it is a human science. In other words, you can find, in the specialist literature, arguments about anything and everything, all defended with the same intensity or even deep convictions! Years of study are needed for people to form their own opinion, by dipping into economics papers to find what seems to be most relevant to the current situation.
You will have noticed that there exists in the news a general convergence of opinions concerning the macroeconomic situation from various stakeholders: BALANCING THE BOOKS, PAYING OFF ALL ACCUMULATED DEBTS. Even if this macroeconomic policy brings about a temporary recession, it will help get rid of the various economic players’ bad habits, which, in turn, will contribute to a much stronger and sound growth when companies have recovered innovative and effective habits (Item 2). This convergence of opinions favoring a standard, classical macroeconomy, despite the brilliance of Keynes, whose Stop and Go public policies have been misunderstood and poorly implemented, is shared today by a broad range of economists, statesmen, trade unionists, and employers.

2. Focusing on wealth creation through private enterprise development

Macroeconomy paves the way for real economy (the economy of enterprises and consumers) to prosper. What we lack is a web of innovating enterprises
- that provide new, combined products and services
- with features that are certified through various labels, prices, competitions, private and public certification bodies, at local, regional, national, European, and international levels
- reliable, safe, robust, tested
- new (software, modes of transport, energy, fashion, medicine, etc.)
- that are interrelated
o geographically (at local, regional, national, international levels)
o in a hierarchical manner (VSEs, SMEs, large companies)
o crosswise (VSE + VSE, SME+ SME, large companies with each other).
Ideas and examples to be found at http://facebook.com/benoit.fabre.1969

EXPLICIT MULTIMEDIA EDUCATION REGARDING THE POLICIES BEING CARRIED OUT
Yesterday evening, I watched the President of the Republic give an excellent speech on the economy on television. Unfortunately, from the various comments I heard from journalists, politicians, or the population, going beyond partisan disingenuousness, it would now appear that his message was poorly received and misunderstood. Why would this be? Because the speech was addressed more to experts in economics than to the population. The issue is that of the cognitive distortion that makes it very hard to transmit technical language to non-experts: doctors, when talking to each other, would not be understood by their patients. The same thing can be said about lawyers, engineers, etc.
Hence, I recommend, over and above expert discourse and decisions, the extensive use of varied publishing and multimedia outlets, so that the message would, at the very least, be understood by the voters, even if they do not necessarily accept it. In a democracy, voters have the right and the obligation to know and to understand who and what they are voting for – surely this is the bare minimum.

In concrete terms, the idea would be to do the following:
- create short films broadcast on the Internet, the television, in cinemas and DVDs;
- broadcast summaries and PowerPoint-type presentations;
- write books for children;
- design comics;
- develop video games for computers, the so-called “serious games”;
- print leaflets and ask trained militants to explain them in face-to-face interaction;
- put up explicit posters;
- give conference sessions and night classes;
- commission literary fiction and short stories;
- sell magazines designed to familiarize people with basic economic concepts, etc.

PENSION REFORMS
I repeat my propositions regarding pensions:
- Reducing pensions beyond a minimum threshold represented by the SMIG (guaranteed minimum wage for full-time employees) through deindexing of the pension part beyond the SMIG, or even a reduction by a factor of 2. NB: the same type of operation could be carried out on the family grants. The most important thing is to be simple, understandable, readable, and verifiable, so as to elicit greater acceptance on the part of the population.
- Increasing the pensionable age in such a way that it is compatible both with public finances, life expectation in good health, and the actual reality of individual circumstances (illness, impact of age on the job: arduous work, hard to break unemployment). Currently, I believe that the legal pensionable age is 65 years, with derogations possible via a court of arbitration made up of 3 judges (representing the State, the social partners, and the employees).
- Increasing employees’ contributions; the social contributions borne by the employers are too heavy at the moment, which worsens our competitivity against less developed, low cost, countries and blocks employment, which ultimately will penalize those very same employees!