The French Have It Better?

As I keep saying, facts matter. Facts matter more than ideological consistency if you want to know. That’s why I keep comparing us with the other society I know well, France. I am up to-date on it, a task facilitated by the fact that I read a major French newspaper on-line every day, by the fact that I watch the French-language Francophone television chain, TV5 nearly every day, and by occasional recourse to my brother who lives in France. My brother is especially useful as a source because he is well-informed by French standards, articulate, and an unreconstructed left-of-center statist. I suspect he has never in his life heard a clear exposition of how markets are supposed to work. He is a typical Frenchman in that respect.

I almost forgot: I must admit that I watch a French soap opera five days a week at lunchtime. And finally, I spy on my twenty-something French nieces and nephews through Facebook. I never say anything to them so they have forgotten I am their so-called “friend.” I almost forgot again: Until recently, I went to France often. Every time I was there, I made it my duty to read local newspapers and newsweeklies and to listen to the radio and to watch the news on television. I said “duty” because it was not always fun.

So, those are my credentials. I hope you find them as impressive as I do.

And, incidentally, for those who know me personally, mostly around Santa Cruz, the rumor that I am a guy from New Jersey who fakes a French accent to make himself interesting to the ladies, that rumor has no foundation. In fact, the accent is real. French is my first language; the accent never went away and it’s getting worse as my hearing deteriorate. I like to write in part because I don’t have much of an accent in writing. Got it?

I found out recently that the French national debt to GDP ratio is about 85. That is, French citizens, as citizens, owe 85 cents for every dollar they earn in a year. The debt is a cumulative total, of course, And “national debt” refers to what’s owed by the national government of a country. The private debt of the citizens of the same country is an unrelated matter. Another way to say the same thing is that should you reduce the national debt of your country down to zero, it wouldn’t help you directly with your personal credit card balance. (It might help you indirectly to some extent because you wouldn’t be in a position anymore to compete with the federal government for credit. This competition raises interest rates.)

The national debt also does not include the debts of states and local governments. In this country, the aggregate of these non-federal government debts is also high because of our decentralized structure. Let me say it another way: The national debt, associated entirely with the federal government, is a relatively small fraction of the total debt US citizens owe by virtue of the cost of their overall system of government. It’s relatively small as compared to the same quantity for France, for example. The French national debt includes most sub-debts that would be counted as state debt and local debt in this country. Accordingly, the French national debt is overestimated as compared to ours. If French accounting were like ours the French national debt would be considerably less than 85% of GDP.

Well, you ask: What’s ours, our national debt as a percentage of GDP? Fair enough:

It’s about 100% of GDP, 15 points higher than the French percentage. We are closer to Greece than France is in that respect.

This pisses me off no end. The divergence between the directions taken by French society and American society occurred during my adulthood. I witnessed that divergence in concrete terms through my French relatives and directly, through my visits to France, and the occasional longish sojourn there, and so forth. So, let me summarize what I saw in France during the past thirty years.

The French eat better than Americans. They always did but their food could have become worse under “socialism.” Even the children who stay at school over lunch eat good meals for a nominal sum. School lunches in the average French town taste better than the fare of a better-than-average American restaurant, in my book.

The French have longer vacations than Americans. That’s all of them, all Americans, including civil servants and bricklayers’ union members. Five weeks is the norm in France. You read that right: 5!

In many French municipalities – I am tempted to say “most” but I have not done the research – children go skiing at public expense one week each year or more. There are also many subsidized “initiation to the sea” summer camps.

It’s also true that Americans have bigger houses and bigger cars than do French people. Personally (and I am a kind of small expert on the topic) I think French universities are not nearly as good as their American counterparts. I mean that the best French universities don’t come close to the best American universities and that the worst American universities maintain standards absent in the worst French universities. Elementary and secondary French schools seem to me to be about equivalent to American schools. They also turn out large numbers of functional illiterates. But, there is more.

The French have universal health care that is mostly free. It hurts me a lot to say this but I saw it at work several times, including under trying circumstances, and the French national health care system performed fine every time. (There is an essay on this topic on this blog, I think.) I know this is only anecdotal evidence but the raw numbers don’t contradict my impression. In point of fact, French males live two years longer than American men. I realize this superior longevity could be due to any number of factors (except genetic factors, both populations are very mixed). However, it is not compatible with a truly horrendous “socialized medicine” system. And, yes, I too would like to credit Frenchmen’s longevity to regular drinking of red wine but it’s not reasonable. If it were, a health cult of red wine would have been launched by the wine industry in this country a long time ago.

The French collectively spend about half as much as we do on health care.

I can hear my virginal libertarian friends howling: The French can afford all those tax-based luxuries because they are less likely than Americans to become involved in military ventures. (And I would add, they cut out earlier, as they are now doing in Afghanistan.) But the numbers have to jibe: In the past thirty years, the US never spend more than 5% of GDP on the military. In most years, it was under 4% . Both figures include incompressibles such as veterans’ benefits that aren’t really spent to wage war, now or in the future. Those costs, about ¼ of the military budget in the average year, would be more or less made up elsewhere if they did not exist. So, it seems to me that higher military budgets cannot begin to account for the fifteen percentage points the French have over us in their national debt relative to GDP.

I am a small government conservative who would call himself a libertarian if I did not see the word as associated with pacifism. Yet, I cannot look away from these simple facts. I wish I had an answer to the quandary they pose but I don’t.  Any ideas?

About Jacques Delacroix

I am a sociologist, a short-story writer, and a blogger (Facts Matter and Notes On Liberty) in Santa Cruz, California.
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10 Responses to The French Have It Better?

  1. Terry Amburgey says:

    Relative tax revenues? I’m tempted to say something snarky but I won’t. What are taxes like in France?

    • jacquesdelacroix says:

      Snark all you wish, Terry. Whatever you say you are still only almost a Canadian, almost!

      I don’t have much reason to pay attention to French taxes so far. The raw numbers are enough for me. With all those thirty years of leisure and comfort, they still owe less than Americans under the rubric of “costs of government.” As I said, this fact alone pisses me up no end.

      If I were going to describe what little I know of French taxation, against my better judgment, I would start with the fact that they have a big VAT (up to 20% of invoice). Like all VAT taxes, it ‘s steeply regressive and a constant invitation to fiscal fraud : “Would you like your invoice with or without VAT Mr D. ?”

  2. Terry Amburgey says:

    Those sorts of things could account for the debt differential. If your spending exceeds your revenue then you have to borrow. It may be that the lower sovereign debt is the result of higher taxes. Some people might be willing to get lower debt through higher taxes but I’m not sure that you would see that as a good thing 🙂

    • jacquesdelacroix says:

      Not surprisingly, I think a government that has not source of income aside from taxes should only borrow for a short time and against certain revenue or, in an emergency. Other than that, government should live within its means and taxes are much too high from a moral standpoint.

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  4. thecrackshotcrackpot says:

    First of all, I just want to say that I love the French (unlike some people I know). I love their territory (although not so much their former colonies), I love their women, and I would probably love their food, but I only ate at McDonald’s while I was there (this was a budgetary call, not an ethnocentric one).

    I think this is a structural issue. The federal government is not designed to function efficiently outside of the express powers given to it by the constitution. The fact that Washington tries to do all of the things that a unitary state does and ignores the law of the land while trying to perform them probably has something to do with the disparities.

    Terry is right, too, and I would agree that a lower debt-to-GDP ratio through higher taxes for the next little while is a good thing. It’s better than kicking the can down the road. The easiest way to do this: cut the corporate tax rate to zero, eliminate consumption taxes, and implement the progressive tax rate on personal income for a decade. Then eliminate it completely, and institute a resource-based(it’s in the ‘comments’ section) tax and call it a day.

    An easy way to cut spending while raising taxes and otherwise getting our fiscal house in order: stop subsidizing the security of rich states in Western Europe and East Asia. Oh, and withdraw our troops from the Islamic world. This last move would also eliminate much of the terrorist threat to the United States. Hell, if we didn’t have troops overseas in Islamic lands, we could probably afford to play the role of hero again and bomb a couple of dictators every once in a while!

    Yes, I know that the defense budget is only 4% of GDP, but that number betrays the true costs of military spending. Currently, military and military-related spending accounts for 19% (more or less) of the federal budget (third after Social Security and our crappy medical programs). Since our military spending is both fruitless and dangerous, it is an easy “program” to cut while taxes go up and spending goes down.

    • jacquesdelacroix says:

      National defense is the only federal function in the Constituion so, it’s fine that if accounts for one fifth of the federal budget. It should be closer to 100%

  5. Thomas H. says:

    Sir,

    A late comment: I also like the French and studied that subject matter for some years in school, and this without really learning much, save for the French themselves are very clever. I do have a comment or two about politics and related public finance in that country – France had great prospects as a European power years ago, but Mitterrand came to power and the progress of the country was retarded, which according to socialist dogma of the time was a good thing. Second, despite some popular knowledge about public finance, and the presumed accuracy of debt statistics, no one really knows what the Treasury holds in countries like France, and people like me do not doubt the richness of that place; this even despite the bankruptcy of “La secu” some time ago. I do not know what to say here. You’re hitting on all cylinders.

  6. Gabriel says:

    Title : The French have it better.

    I believe you are implying that some how, some way the French system is a better system and you see that through % of Debt to GDP. I think it is reasonable to say that a person who lives in Apartment in the United States has a very different apartment than a French apartment. I know this because I backpacked through Europe after I graduated from your class and had a French friend who let us sleep at his apartment while we were touring Paris. His apartment was a little larger than my bathroom (this is not a joke).

    Apartment to buy price per sq meter:
    US $1,960.07
    France $6,314.33
    Sourced below

    The standards of living for a median US Citizen is higher than the median French Citizen. Also I think the French VAT tax is a better taxing system than the US tax system. Which makes more revenue for France. The poor pay more taxes in France than the poor in the US. Also, It is very easy for a small business owner to wash personal expenses through their business and understate earnings. If I understand the VAT tax correctly, it works like a sales tax, therefore if you buy something you have no choice but to pay the tax. I think that this makes sure that everyone who is spending money is paying tax as opposed to it being against your income and I think it is a more effective tax system

    I would also like to add that you are forgetting where the best doctors in the world are created, yes, that is here, in the United States. No one flies to Paris to get brain surgery. This is because we have created an incentive system (pre-obama care) to attract the smartest and the brightest people to become doctors.

    About Socialized Medicare. I have witnessed with my ex girl friend, who is Greek, who has told me nightmare stories of socialized health care. Without a long winded story, just picture going to the DMV…but its now a doctors office where you’re getting treated for cancer. I think you will also find statistics that show peoples lives could have been saved by chemotherapy, but since there were so many people in line and not enough doctors, the cancer patients did not get treated.

    I believe you are forgetting the quality of life in the US vs France. I don’t see random people on the street running up to my car to clean my windshield for a nickel when driving down the street in America.

    Now about the actual Debt. Obama has spent more in 1 year than Bush did in all 8. Now that is an accomplishment. If you were to take the 8 trillion dollars he spent and divided it among every single living human in the US every single person would be ~ 26,000 per living US Citizen (assuming about 300 million people live in the US). To where all that money went..I don’t know. But I know that it was spent. I believe if we didn’t have this fiscally irresponsible President our Debt to GDP % would be a lot less and I would argue that it would be lower than France. France has taken a recent spike in Debt % to GDP and now with the Euro debt criss I wouldn’t be surprised if they go deeper into debt to try and recover their economy. It seems to be that Europe is in a 2-3 year lag vs the US economy. We just call it Citigroup debt and they call it Italian debt. Which makes even more sense if you look at the entire Euro countries GDP is ~ the size of US GDP. They are going to need a bail out or debt reconstruction no matter how you slice it and I would image that you will see a big spike in debt.

    I think you can conclude that some of the variance is just a timing difference in conjunction with a fiscally irresponsible President which I think will reverse in the future. But I believe having a standard apartment in the US vs having a standard apartment in France are two very different things.

    Source:
    http://www.numbeo.com/cost-of-living/compare_countries_result.jsp?country1=United+States&country2=France

    • jacquesdelacroix says:

      Gabriel: I don’t really know what I wanted when I posted that essay except what you did: discuss and debate. Originally, I was shocked and pissed off that after all our virtuousness, our debt/GDP ratio was not better than that of the grossly self-indulgent French!

      I agree with most of what you say and I am not moving to France soon. “Most” because my mind is not made up on the very important issue of public health. The affirmation that we have the
      “best doctors in the world” sounds to me like a meaningless slogan invented by conservative friends of mine, unfortunately. French men live two and half years longer than American men, on the average. It does not prove that French medical care is superior. It sure does not indicate that it’s inferior. We have to deal with the facts (unfortunately!)

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