“[He] belongs more in an insane asylum than at the head of a multinational corporation.”

beret-on-cowboyThat was the reaction by a French union official to an amusingly harsh letter by Maurice Taylor, chief executive of tire maker Titan. Taylor was initially interested in buying the French tire factory, which is facing closure following five years of unsuccessful negotiations with unions to enhance its competitiveness. However, after visiting the plant three times, he wrote a letter to France’s industry minister Arnaud Montebourg, saying: “Sir, you would like to open discussions with Titan. You think we’re that stupid?”

Taylor says the plant’s 1,173 workers “have one hour for their lunch, they talk for three hours and they work for three hours. I said this directly to their union leaders; they replied that’s the way it is in France.” The Titan CEO added:

“Titan has money and the know-how to produce tyres. What does the crazy union have? It has the French government. The French farmer wants cheap tyres. He doesn’t care if those tyres come from China or India and these governments are subsidising them. Your government doesn’t care either: ‘We’re French!’

Titan is going to buy a Chinese tyre company or an Indian one, pay less than one euro per hour wage and ship all the tyres France needs. You can keep the so-called workers.

Taylor isn’t exaggerating the problems caused by French unions. In his new book, Becoming Europe, Acton’s Director of Research Samuel Gregg writes,

According to France’s 3,200 page Code du Travail. . . any company inside France that exceeds 49 employees is legally obliged to establish no fewer than three worker councils. If such businesses decide they need to let go some employees, they are required to present a reorganization plan to all three councils. Is it any wonder that many French businesses simply don’t bother expanding their employee base, a factor that often inhibits their capacity to generate more wealth?

But there are also less obvious losers from the privileges enjoyed by unions. Trade unions are focused upon protecting the interests of those who are already employed. Hence, they have no interest in the well-being of the unemployed­ – which reached its highest-ever level of 11 percent in the euro-area zone in April 2012. After all, the unemployed do not pay union dues. Moreover, if they were able to access the labor market more easily, this would make it harder for unions to avoid renegotiating the wages and conditions of those with jobs.

French politician Bernard Accoyer also admits that Taylor’s assessment is “not completely unfounded”, adding that the country’s “serious competitiveness problem” was linked with the “extremist hardliner” views of some unions.

Seeing the head of a multinational corporation take on intransigent international unions is refreshing. But it shouldn’t be surprising since Taylor has never been shy about offending foreigner interests. In a commercial for Titan, Taylor once said that putting a Japanese-made Firestone on American farm equipment is like “putting a kimono on a farmer.”

While we at Acton do not share Taylor’s protectionist sentiments, we do share his horror at the idea of putting a beret on a cowboy. Quelle absurdité. That’s just one more reason we don’t need to “become Europe.”