What should the French be told?

The latest polls in France show that a large majority of the population think s that t he country’s current economic policy is not going to improve the country’s situation (66%) and is unfair (76%). The reasoning behind the economic policy required in France must therefore be explained to the French: France’s income inequality (before it is corrected by redistributive policies) is mainly due to the country’s low employment rate. A central economic policy goal must therefore be to lift the employment rate (and not to improve the purchasing power of those with a job); A comparison between OECD countries shows that a high employment rate is associated with high labour force and youth skills, and with a low weight of corporate social contributions. It is therefore necessary to reform the education and vocational training system and to reduce some corporate taxes (those that have an effect on employment); In a situation where the level of product sophistication is quite low , labour costs are high and, accordingly, France continues to deindustrialise, it would be dangerous to conduct a policy to boost household purchasing power as long as production has not risen up the value chain. As it will take several years for the reforms of the tax system and of the training system to bear fruit, the French will have to accept quite a long period of wage moderation to improve the country’s competitiveness as long as the economy is not sufficiently high up the value chain; As the constraint to reduce the fiscal deficit is tight, it is important to avoid increasing the fiscal deficit through tax cuts or public spending hikes that have no proven effect on employment.