Christopher Caldwell on Christophe Guilluy on French Elites

If you want to understand what's wrong with European immigration policy, Christopher Caldwell's 2009 book Reflections on the Revolution in Europe is the best start:

In his provocative and unflinching book Reflections on the Revolution in Europe, he reveals the anger of natives and newcomers alike. He describes asylum policies that have served illegal immigrants better than refugees. He exposes the strange interaction of welfare states and Third World traditions, the anti-Americanism that brings natives and newcomers together, and the arguments over women and sex that drive them apart. And he examines the dangerous tendency of politicians to defuse tensions surrounding Islam by curtailing the rights of all.

He has a long new piece on the French real estate consultant Christophe Guilluy, who was become an improbable analyst of French society. Actually, not so improbable: Choosing where to live strips away the bullshit and lays peoples' actual preferences (as opposed to their public pieties) about multiculturalism, diversity, etc. bare. Guilluy uses urban geography to create an analysis of the divisions plaguing French society:

In our day, the urban real-estate market is a pitiless sorting machine. Rich people and up-and-comers buy the private housing stock in desirable cities and thereby bid up its cost. Guilluy notes that one real-estate agent on the Île Saint-Louis in Paris now sells “lofts” of three square meters, or about 30 square feet, for €50,000. The situation resembles that in London, where, according to Le Monde, the average monthly rent (£2,580) now exceeds the average monthly salary (£2,300).

The laid-off, the less educated, the mistrained—all must rebuild their lives in what Guilluy calls (in the title of his second book) La France périphérique. This is the key term in Guilluy’s sociological vocabulary, and much misunderstood in France, so it is worth clarifying: it is neither a synonym for the boondocks nor a measure of distance from the city center. (Most of France’s small cities, in fact, are in la France périphérique.) Rather, the term measures distance from the functioning parts of the global economy. France’s best-performing urban nodes have arguably never been richer or better-stocked with cultural and retail amenities. But too few such places exist to carry a national economy. When France’s was a national economy, its median workers were well compensated and well protected from illness, age, and other vicissitudes. In a knowledge economy, these workers have largely been exiled from the places where the economy still functions. They have been replaced by immigrants.

After the mid-twentieth century, the French state built a vast stock—about 5 million units—of public housing, which now accounts for a sixth of the country’s households. Much of it is hideous-looking, but it’s all more or less affordable. Its purpose has changed, however. It is now used primarily for billeting not native French workers, as once was the case, but immigrants and their descendants, millions of whom arrived from North Africa starting in the 1960s, with yet another wave of newcomers from sub-Saharan Africa and the Middle East arriving today. In the rough northern suburb of Aubervilliers, for instance, three-quarters of the young people are of immigrant background. Again, Paris’s future seems visible in contemporary London. Between 2001 and 2011, the population of white Londoners fell by 600,000, even as the city grew by 1 million people: from 58 percent white British at the turn of the century, London is currently 45 percent white.

While rich Parisians may not miss the presence of the middle class, they do need people to bus tables, trim shrubbery, watch babies, and change bedpans. Immigrants—not native French workers—do most of these jobs. Why this should be so is an economic controversy. Perhaps migrants will do certain tasks that French people will not—at least not at the prevailing wage. Perhaps employers don’t relish paying €10 an hour to a native Frenchman who, ten years earlier, was making €20 in his old position and has resentments to match. Perhaps the current situation is an example of the economic law named after the eighteenth-century French economist Jean-Baptiste Say: a huge supply of menial labor from the developing world has created its own demand.

This is not Guilluy’s subject, though. He aims only to show that, even if French people were willing to do the work that gets offered in these prosperous urban centers, there’d be no way for them to do it, because there is no longer any place for them to live. As a new bourgeoisie has taken over the private housing stock, poor foreigners have taken over the public—which thus serves the metropolitan rich as a kind of taxpayer-subsidized servants’ quarters. Public-housing inhabitants are almost never ethnically French; the prevailing culture there nowadays is often heavily, intimidatingly Muslim.

 At the opening of his new book, Guilluy describes twenty-first-century France as “an ‘American’ society like any other, unequal and multicultural.” It’s a controversial premise—that inequality and racial diversity are linked as part of the same (American-type) system and that they progress or decline together. Though this premise has been confirmed in much of the West for half a century, the assertion will shock many Americans, conditioned to place “inequality” (bad) and “diversity” (good) at opposite poles of a Manichean moral order. This disconnect is a key reason American political discussions have turned so illogical and rancorous. Certain arguments—for instance, that raising the incomes of American workers requires limiting immigration—can be cast as either sensible or superstitious, legitimate or illegitimate, good or evil, depending on whether the person making them is deemed to be doing so on the grounds of economics or identity….

France’s most dangerous political battles play out against this backdrop. The central fact is the 70 percent that we just spoke of: they oppose immigration and are worried, we can safely assume, about the prospects for a multiethnic society. Their wishes are consistent, their passions high; and a democracy is supposed to translate the wishes and passions of the people into government action. Yet that hasn’t happened in France.

Guilluy breaks down public opinion on immigration by class. Top executives (at 54 percent) are content with the current number of migrants in France. But only 38 percent of mid-level professionals, 27 percent of laborers, and 23 percent of clerical workers feel similarly….

As Paris has become not just the richest city in France but the richest city in the history of France, its residents have come to describe their politics as “on the left”—a judgment that tomorrow’s historians might dispute. Most often, Parisians mean what Guilluy calls la gauche hashtag, or what we might call the “glass-ceiling Left,” preoccupied with redistribution among, not from, elites: we may have done nothing for the poor, but we did appoint the first disabled lesbian parking commissioner….

Never have conditions been more favorable for deluding a class of fortunate people into thinking that they owe their privilege to being nicer, or smarter, or more honest, than everyone else. Why would they think otherwise? They never meet anyone who disagrees with them. The immigrants with whom the creatives share the city are dazzlingly different, exotic, even frightening, but on the central question of our time—whether the global economic system is working or failing—they see eye to eye….

Those outside the city gates in la France périphérique are invisible, their wishes incomprehensible. It’s as if they don’t exist. But they do.

The two traditional French parties—the Republicans, who once followed a conservative program elaborated by Charles de Gaulle; and the Socialists, who once followed socialism—still compete for votes, but along an ever-narrowing spectrum of issues. The real divide is no longer between the “Right” and the “Left” but between the metropoles and the peripheries. The traditional parties thrive in the former. The National Front (FN) is the party of the outside.

French elites have convinced themselves that their social supremacy rests not on their economic might but on their common decency. Doing so allows them to “present the losers of globalization as embittered people who have problems with diversity,” says Guilluy. It’s not our privilege that the French deplorables resent, the elites claim; it’s the color of some of our employees’ skin. French elites have a thesaurus full of colorful vocabulary for those who resist the open society: repli (“reaction”), crispation identitaire (“ethnic tension”), and populisme (an accusation equivalent to fascism, which somehow does not require an equivalent level of proof). One need not say anything racist or hateful to be denounced as a member of “white, xenophobic France,” or even as a “fascist.” To express mere discontent with the political system is dangerous enough. It is to faire le jeu de (“play the game of”) the National Front….

In France, political correctness is more than a ridiculous set of opinions; it’s also—and primarily—a tool of government coercion. Not only does it tilt any political discussion in favor of one set of arguments; it also gives the ruling class a doubt-expelling myth that provides a constant boost to morale and esprit de corps, much as class systems did in the days before democracy. People tend to snicker when the question of political correctness is raised: its practitioners because no one wants to be thought politically correct; and its targets because no one wants to admit to being coerced. But it determines the current polarity in French politics. Where you stand depends largely on whether you believe that antiracism is a sincere response to a genuine upsurge of public hatred or an opportunistic posture for elites seeking to justify their rule….

Like much in French intellectual life, Guilluy’s newest book is intelligent, original, and rather slapdash. Its maps, while brilliantly conceived, are poorly explained. Its forays into social science are mis-designed—Guilluy’s “indices of fragility” are based on redundant, highly correlated factors that exaggerate the points he means to make. The book has been assembled sloppily and, it seems, hastily. Long prose passages turn up twice on the same page, as if the editor spilled a cup of coffee while cutting and pasting….

But as the prospect of rising in the world is hampered or extinguished, the inducements to ideological conformism weaken. Dissent appears. Political correctness grows more draconian. Finally the ruling class reaches a dangerous stage, in which it begins to lose not only its legitimacy but also a sense of what its legitimacy rested on in the first place.

Mark Blyth on The Origins of Neo-Nationalism

It's not often you stumble across some professor who says he's going to explain the world, and then watch him actually do it.

I stumbled across Mark Blyth via MetaFilter. Mark Blyth is political science professor at Brown University — Wait! I know, you're thinking Brown University, the tiny, ultra-expensive US liberal arts college which is a hotbed of the most demented form of political correctness? Can any professor there be capable more than soft-focus P.C. pieties?

Well, Mark Blyth can. Perhaps because he's Scottish. Very Scottish, if you listen to him. In 2016, Blyth accomplished a pretty impressive trifecta in 2016: he accurately predicted Brexit, the Italian constitutional referendum, and Trump. His big idea is Global Trumpism, which involves defections both to the right and the left from the globalist neoliberal consensus. Whether it's Podemos in Spain or Trump in the U.S., middle-class voters in the West are reacting to 30 years of tectonic changes in the global political and economic landscape which have seen their quality of life being gradually eroded.

The end result is a sense of seething frustration in the middle and lower classes of Western countries. Unions have been crushed, more and more risk shifted onto the shoulders of individuals, job security is a thing of the past, international competition and automation are destroying millions of jobs which will never come back, the small luxuries of middle-class life are drifting out of reach, and each generation is seeing a decline in its standard of living compared to the last one.

All the while, the rich are getting almost exponentially richer, and mainstream politicians — whether center-right or center-left, there is no meaningful difference — seem at best helpless or disinterested at worst actively corrupt.

Here's some remarks he published in Foreign Policy (previous link), which are a bit heavy on the economics but still get the point across:

Back in 1943, [Michal Kalecki] he argued that once you target and sustain full employment over time, it basically becomes costless for labor to move from job to job. Wages in such a world will have to continually rise to hold onto labor, and the only way business can accommodate that is to push up prices. This mechanism, cost-push inflation, where wages and prices chase each other up, emerged in the 1970s and coincided with the end of the Bretton Woods regime and the subsequent oil shocks to produce high inflation in the rich countries of the West in the 1970s. In short, the system undermined itself, as both Goodhart and Kalecki predicted. As countries tried harder and harder to target full employment, the more inflation shot up while profits fell. The 1970s became a kind of “debtor’s paradise.” As inflation rose, debts fell in real terms, and labor’s share of national income rose to an all-time high, while corporate profits remained low and were pummeled by inflation. Unions were powerful and inequality plummeted….

But if it was a great time to be a debtor, it was a lousy time to be a creditor. Inflation acts as a tax on the returns on investment and lending. Unsurprisingly in response, employers and creditors mobilized and funded a market-friendly revolution where the goal of full employment was jettisoned for a new target—price stability, aka inflation—to restore the value of debt and discipline labor through unemployment. And it worked. The new order was called neoliberalism.

Over the next thirty years the world was transformed from a debtor’s paradise into a creditor’s paradise where capital’s share of national income rose to an all-time high as labor’s share fell as wages stagnated. Productivity rose, but the returns all went to capital. Unions were crushed while labor’s ability to push up wages collapsed due to the twin shocks of restrictive legislation and the globalization of production. Parliaments in turn were reduced to tweet-generating talking shops as central banks and policy technocrats wrested control of the economy away from those elected to govern.

Seen this way, what we see is a reversal of power between creditors and debtors as the anti-inflationary regime of the past 30 years undermines itself—what we might call “Goodhart’s revenge.” In this world, yields compress and creditors fret about their earnings, demanding repayment of debt at all costs. Macro-economically, this makes the situation worse: the debtors can’t pay—but politically, and this is crucial—it empowers debtors since they can’t pay, won’t pay, and still have the right to vote….

The traditional parties of the center-left and center-right, the builders of this anti-inflationary order, get clobbered in such a world, since they are correctly identified by these debtors as the political backers of those demanding repayment in an already unequal system, and all from those with the least assets. This produces anti-creditor, pro-debtor coalitions-in-waiting that are ripe for the picking by insurgents of the left and the right, which is exactly what has happened.

In short, to understand the election of Donald Trump we need to listen to the trumpets blowing everywhere in the highly indebted developed countries and the people who vote for them. 

The global revolt against elites is not just driven by revulsion and loss and racism. It’s also driven by the global economy itself. This is a global phenomenon that marks one thing above all. The era of neoliberalism is over. The era of neonationalism has just begun.

Blyth actually shines in videos; he's an outstanding and engaging speaker. I switched this video on to run in the background while I did some housework, but found myself repeatedly rushing to the computer to replay something I didn't quite get. This video is the best exposition of his theory as a whole. You'll have to get used to his Scottish burr:

Although his main critique is aimed at the technocratic managers of national and international economic policy, he also directs withering critiques at center-left politicians, who hurl accusations of politically-incorrect thoughtcrime to appear "left" while simultaneously suckling at the teat of the financial and technological elite and doing nothing to improve the lot of the middle class.

Blyth thinks the U.S. will stumble through, but Blyth believes that the outlook for Europe is much bleaker (this discussion starts at about 41:00). The Euro is a disaster which cannot be fixed, but European technocrats still refused to understand this, and continue to inflict crippling austerity on the European South in a doomed attempt to save it.

The Logic of the Buchpreisbindung

I've blogged before about the Buchpreisbindung, a German law that forbids price competition among booksellers on newly-published books. One of the points of the BPB, if I may call it that, is to preserve smaller independent bookstores from extinction at the hands of large chains, whose size permits them to command steep discounts from publishers. There's a lot of commentary back and forth about whether the BPB is a good idea, and I can see upsides and downsides. But this fascinating piece on the impact of chain stores and Amazon on the American publishing industry shows what happens when there's no BPB:

For most of their modern history, the primary goal of publishers was to find brilliant writers and produce books. Publishers left it to other book lovers—independent bookstores across the country—to sell the fruits of their labors. Booksellers not only carried books tailored to their local audiences, but also promoted their favorite new books through personal recommendations to their customers. All indies ordered books at a standard discount—somewhere around 40 percent off the list price. In the ’70s and ’80s the number of new book titles grew steadily, as did the number of independently owned bookstores.

But this trend came to a halt when chain superstores such as Barnes & Noble and Borders began taking over in the late ’80s. They set up shop down the street from successful independents, lured customers with a broader array of books and lower prices, and put their competitors out of business. In the early ’90s there were roughly 6,000 independent bookstores across the country. Today, that number is closer to 2,200.

There is not a whole lot of mystery behind these stores’ runaway success. Barnes & Noble wasn’t getting rich by offering caffeine with the classics; it was negotiating better discounts from publishers.

In 1994 the American Booksellers Association (ABA), a group that represents independent bookstores nationwide, filed suit against five major publishing companies for offering discriminatory discounts that weren’t justified by costs. One large publisher, for instance, was requiring that bookstores order 3,000 of their books in order to get a 48 percent discount. A smaller order would net a 40 percent discount. That meant that smaller stores, making smaller orders, could not afford to meet larger retailers’ prices. With even the higher-volume indies unable to compete, small bookstores across the nation were forced to close their doors.

While publishers were guilty of providing two-tiered discounts, there was reason to believe that the chain stores were using strong-arm tactics to demand these discounts of larger publishers. Bruce Spiva, one of the lawyers who brought the ABA’s case, recalls hearing that the chain stores had threatened to remove publishers’ books from stores if they didn’t cooperate.

The five publishers (Houghton Mifflin, Penguin USA, St. Martin’s, Rutledge Hill, and Hugh Lauter Levin) settled, but in 1997 the ABA found that the chain bookstores were still demanding and receiving discounts that weren’t being made available to independent bookstores. The ABA sued Barnes & Noble and Borders directly for leveraging discriminatory discounts. In 2001 this lawsuit, too, was settled, on the condition that a large amount of the evidence the ABA had collected against the chain stores be destroyed.

There's much, much more, and it's all fascinating. As they so often say, go read the whole thing…

Vacation Policies in Europe and the USA

A recent report from the Center for Economic and Policy Research in Washington, D.C. compared government policy on paid vacation time among OECD nations. No surprises here; the chart says it all:

Vacation_time_chart

A couple caveats here: the report’s authors don’t seem to have considered U.S. state law. I suspect that that more liberal U.S. states probably do provide mandated paid vacation, and it might be helpful to know which ones do. Nevertheless, as the authors correctly note, there’s no federal regulation on the subject, so states are free to act as they please. As for Germany, the authors note: "[T]here is only one national public holiday, German Unity Day. Other public holidays are determined on the state level, and vary between 0 and 16."

Of course, American workers do get holidays. As usual, though, the amount of vacation you get will vary with your social power:

On average, private-sector workers in the United States have about nine days of paid vacation per year, plus about six paid holidays. . . . .  [P]art-time workers, low earners, and workers in small establishments (fewer than 100 workers) are less likely to receive paid vacation and paid holidays, and when they do, these workers receive fewer paid days off. Lower-wage workers are less likely (69 percent) than higher-wage workers (88 percent) to have paid vacations.

Mandatory paid vacation is a classic welfare-state policy. Policies like these serve at least three functions. First, they ensure that everybody gets some vacation. Second, they ‘signal’ that leisure time is an important social value and policy goal. As the report notes, most European employers actually go above the minimum requirements voluntarily. Third, they ensure that the gap between rich and poor in vacation time does not become too large.

In any society, the highly-qualified or well-connected have a lot of autonomy concerning how much they choose to work. Of course, many choose to work extremely hard, but they don’t have to; they can bargain away money and prestige in favor of leisure time (or time with the family) whenever they wish. It’s the less-qualified, ‘interchangeable’ workers that get the short end when there are no policies to protect them. Put another way, if you’re a low-skilled employee in Europe, you’re not more likely than an American low-skilled employee to get more than the legal minimum of paid vacation. But, as we see, that legal minimum is very different…