Reforming France: State of denial | The Economist

More on the euro.

It is always easy for analysts and economists to make broad pronouncements about the prescriptions for what ails the euro block. However, as politicians know all too well, political reality and economics do not always mix.

For example, as this article in The Economist discusses, President Sarkozy of France is trying to raise the retirement age in France to 62 years old from 60 years old. To us in the U.S., this seems like a "no brainer"; you can't get any Social Security benefits until you're 62, and full benefits are not paid until you are 70.

Not so in France, where large protest rallies are being held against the proposed changes:

..... It was President François Mitterrand in the early 1980s who introduced retirement at 60 as a mark of progress, and it remains a totem for the left and the right. Martine Aubry, the Socialist Party leader, instantly called the government’s plan “irresponsible”, and says that the Socialists will reverse it if they are elected to power in 2012. Union leaders too have queued up to denounce the reforms. François Chérèque, one union boss, called it “a provocation”. A day of strikes and protests is planned for June 24th.

As a statement about France’s long-run resolve to control its public finances, it is also reasonably serious. France is running a high budget deficit (8% in 2010), which is closer to that of Greece (9%) than Germany (5%). Its gross public debt is forecast to be 85% this year. And it is under pressure from the credit-ratings agencies to send a strong message of its determination to get a grip on public finances.

Reforming France: State of denial | The Economist